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McKINLEYISM 


As  It  Appears  To  A^  Non  -  Partisan 


By   JOHN   BKATTY. 


If  there  be  any  one  that  makes  many  poor  to  make  a  few  rich,  that  suits 
not  a  Commonwealth. — Cromwell. 


SECOND    EDITION. 


Rrlce,        -        -        25   Oemts. 


columbus,  ohio. 

Hann  &  Adair,  Printers. 

1891. 


Abraham  Lincolu  had  broad  and  statesmau-Uke  views  con- 
ceroiug  our  trade  and  commerce.  We  could  learn  much  as  the 
result  of  his  example.  I  have  been  interested  to  note  how  ig- 
norant many  self-appointed  champions  of  our  industries  are  of  the 
land-marks  the  fathers  planted.  Much  criticism  has  been  aimed 
at  the  policy  which  proposed  more  liberal  trade  relations  with 
Canada,  and  some  well  intentioned  brothers  have  supposed  that 
in  advocating  such  policy  I  had  departed  from  the  teachings  of 
the  Republican  apostles.  They  seemed  to  have  ignored  or  for- 
gotten the  fact  that  what  I  proposed  had  the  support  of  Abraham 
Lincoln,  Jolui  Quincy  Adams,  Robert  C  Winthrop,  Robert  C. 
fSciieuck,  Thomas  Corwin  and  others,  who  carried  the  first  baimer 
that  the  Republican  party  ever  flung  to  the  breeze. — Hon.  Ben. 
Butterworth,  Cincinnati,  February  15,  1894. 


Entered  according  to  the  act  of  Congress,  in  the  year  1894 

By  Hann  &  Adair, 
In  the  office  of  the  Librarian  of  Congress,  at  Washington. 


MeKINLEYISM 


nss' 


AS    IT   APPEARS 


l^<ii 


NON  =  PARTISAN 


By  JOHN  BEATTY. 


MeKINLEYISM:  Exercise  of  the  taxing  power  of  a 
nation  directly  for  the  benefit  of  a  few  selected  industries,  and 
incidentally  for  the  raising  of  revenue  to  support  the  gov- 
ern nrient. 

2.  Making  the  pecuniary  success  of  a  few  capitalists  the 
object  of  a  national  eeononnic  system  ;  the  -well  being  of  the 
nnen  who  work  for  thena  an  incident  to  the  system,  and  the 
^reat  body  of  the  people  contributors  to  the  beneficiaries  of  the 
system. 

3.  "  The  great  Anierican  systenn  :  "  A  syste«i  of  unequal  tax- 
ation ;  a  system  which  enables  the  manufacturer  to  sell  fifty 
cents  -worth  of  shoddy  for  one  dollar;  a  systenn  which  dimin- 
ishes the  sale  of  An^ierican  food-stuffs  in  foreign  countries;  a 
system  dictated  by  the  woolen  nnanufacturers  of  New  Eng- 
land, the  iron  mongers  of  Pennsylvania,  and  other  combines, 
monopolies  and  pools. 

4.  American  goods  cheap  for  foreigners,  dear  for  Ameri- 
cans. 


•11 1 9QP7 


I  N  DKX. 


I. 

Preface C 

The  Extent  to  which  the  Principle  of  Protection  may  be  Advantageously  Applied. .  9 

Garfield's  Position  on  the  Tariff  Question 11 

McKinley's  Claim  that  a  Revenue  Tariff  is  Inconsistent  with  Protection 12 

Who  Pays  the  Tax  or  Duty 13 

Does  a  Duty  on  Foreign  Goods  Increase  the  Price  of  Domestic  Products 14 

11. 

Low  Tariff  Periods  Contrasted  with  High  Tariff  Periods 20 

Testimony  of  Wells,  Allison  and  Blaine  as  to  the  Condition  of  the  Country  under 

the  Low  Tariff  of  1846 22 

Klaine's  Attempt  to  Break  the  Force  of  His  Own  Admissions 23 

Schurz's  Rejoinder 25 

Republican   National   Convention  of   1856  and   the   Action   of    the  Thirty-fourth 

Congress   2B 

III. 

McKinley's  Statistical  Argument  in  Favor  of  a  High  Tariff  Briefly  Considered  ....  27 

Is  the  Fact  that  a  Nation  Buys  More  than  it  Sells  Evidence  of  Poor  Management..  30 
The  Panic  of  1857  Caused  by  the  Failure  of  the  Ohio  Life  and  Trust  Company  and 

not  by  Tariff  Laws 32 

Does  a  Low  Tariff  Send  Money  Abroad 34 

IV. 

Free  Raw  Material  for  Export  Trade  and  Drawbacks 37 

The  Law  Discriminates  Against  the  Home  Laborer  and  in  Favor  of  His  Foreign 

Rival 39 

Combinations,  Pools  and  Trusts  —  Sherman  and  Butterworth 41 

V. 

What  Effect  have  Tariff  Laws  on  the  Wages  of  Workingmen 43 

Thomas  G.  Shearman's  Statistics  on  this  Subject 45 

Carroll  D.  Wright 4T 

Wages  in  Europe 48 


VI. 

The  Condition  of  a  Country  can  not  be  Inferred  from  the  Amount  of  its  Importa- 
tions    50 

Non-dutiable  Imports  for  1890 51 

Our  High  Tariffs  Have  Developed  the  Wheat  Industry  in  Other  Countries 53 

VII. 

Does  Unfavorable  Criticism  of  the  McKinley  Law  in  Other  Countries  Prove  that 

it  is  a  Good  Law  for  this  Country 55 

Memorial  of  the  Colonial  Parliament  of  Bermuda 56 

VIII. 

Our  Trade  with  Canada 59 

Is  the  Lumberman  an  Agriculturalist  ? 60 

Lumber  should  be  on  the  Free  List 60 

Should  Canadian  Products  be  Excluded  1 61 

Butterworth's  Answer , 61 

Mills  on  the  Increase  of  Duties  on  Agricultural  Products .  63 

IX. 

The  Canadian  Farmer  and  his  Wheat 66 

Liverpool  Makes  the  Price  for  American  Wheat 67 

The  Importation  of  Canadian  Wheat  no  Injury  to  the  United  States  Farmer 68 

X. 

Farm  Products  Imported  in  1890 69 

Cattle,  Horses  and  Sheep 70 

Bread  Stuffs 71 

Fruits 73 

Hay 74 

Hops 75 

Flax 76 

Hemp 77 

Meat  and  Dairy  Products 78 

Rice 79 

Linseed,  Flax  Seed  and  Other  Seeds 80 

Tobacco  81 

Vegetables 83 

Wool 84 

1.  How  We  Obtain  Cheap  Clothing 86 

2.  The  Exorbitant  Protection  Accorded  to  the  Woolen  Manufacturer 87 

3.  The  McKinley  Law  does  not  Lessen  Importation  of  Wool 88 

4.  The  Woolen  Manufacturers' Association's  Influence  Politically 89 

5.  It'Makes  the  Price  for  American  Wools 90 

6.  The  McKinley  Law  Discriminates  Against  the  American  Wool-grower  ...  91 

7.  Facts  for  the  Ohio  Farmer  to  Consider   93 

8.  Hides  and  Skins 93 


XI, 

Drawbacks  (Again) 95 

XII. 

Position  of  the  Old  Whigs  on  the  Subject  of  Protection 90 

XIII. 

What  McKinley  Claims  for  His  Law 98 

Ctjnceding  All  He  Claims  is  it  not  an  Argument  in  Favor  of  Lower  Duties  and  a 

Larger  Free  List? 9!l 

The  McKinley  Law  in  some  Respects  an  Improvement  on  Law  of  1883 100 

XIV. 

Influence  of  Invention  on  Prices 102 

XV. 
Is  Free  Sugar  a  Saving  to  the  People 104 

XVI. 
Does  a  High  Tariff  Create  Competition  and  Encourage  Genius  ? 105 

XVII. 

Cause  of  the  Panic  of  1893 lOr. 

Panic  of  1873 112 

XVIII. 

The  Tariflf  Laws  Not  Delicate  and  Sacred  Things  which  cannot  be  Revised  and 

Amended  without  Injury  to  the  Business  of  the  Country 115 

McMillin's  Statement  as  to  who  Prepared  the  McKinley  Bill lit 

John  Sherman  on  same  Subject 11 T 

XIX. 

Shall  All  Old  Laws,  Customs  and  Precedents  be  .Adhered  To? ll'J 

The  EflFect  of  a  Reduction  of  Tariff  Rates  on  the  Iron  Industry 120 

The  Iron  Manufacturers  of  the  Seaboard  Demand  Free  Iron  Ore  and  Coal 12.! 

Certain  Manufacturers  Obliged  to  Use  Foreign  Made  Steel 121 

Strife  Between  Eastern  and  Western  Iron  and  Steel  Producers 125 

XX. 

McKinley's  Assumption  that  a  Low  Tariff  would  Lessen  the   Demand  for  Labor 

not  well  Founded 12G 

When  People  Abroad  Buy  of  Us  they  Pay  Wages  to  our  Laborers  130 


XXI. 

Unemployed  Men,  and  Why  They  are  Unemployed 133 

We  can  not  Sell  Unless  We  Buy 134 

XXII. 

The  Railroad  President  and  Steel  Rails 136 

Reduction   in    Price  of  Steel    Rails   Due    to   Invention    and    to    Improvement   in 

Methods  of  Manufacture 138 

Wages  have  always  been  Higher  in  this  Country  than  in  Other  Countries 131) 

The  DiflFerence  in  Price  Between  American  and  English  Labor  in  the  Production 

of  Steel  Rails HO 

What  was  it  that  Deterred  McKinley's  Railroad  President  from  Buying  Rails? l-il 

XXIII. 

McKinley's  Old  Clothes  Argument US 

Effect  of  Labor  Organizations  on  Wages 1-14 

Have  the  Great  Body  of  our  Laborers  been  getting  as  much  Per  Capita  during  the 

past  Ten  Years  as  they  Obtained  during  the  Ten  Years  Prior  to  the  War? 145 

XXIV. 

The  Old  Merchant  Argument HT 

Men  on  the  Free  List 1*8 

If  High   Tariffs   make   High  Wages  and    Low    Prices.    Wages   should  have   been 

Higher  and  Prices  Lower  in  1830,  than  ever  Before  or  Since 151 

XXV. 

McKinley's  Criticism  of  Gov.  McCorkle 153 

The  Old  Ohio  Republican  Platforms  Suggest  the  Kind  of  Tariff  which  should  be 

Maintained 155 


PREFACE. 


This  book  does  not  pretend  to  any  literary  excel- 
lence, nor  to  anything  beyond  a  hasty  discussion  of  the 
tariflf  question.  A  portion  of  it  was  written  two  years 
ago,  but  the  larger  part  of  it  within  the  past  month.  It 
is  simply  a  free  and  easy  criticism  of  the  dogma  of  high 
protection  as  it  has  been  brought  to  the  attention  of  the 
public  by  the  speeches  of  Gov.  William  McKinley.  In 
the  discussion,  if  it  can  be  called  such,  the  Governor 
has  been  permitted  to  state  his  own  views  in  his  own 
words : 

A  duty  or  tax,  great  or  small,  imposed  on  such  arti- 
cles of  foreign  make  and  growth  as  come  into  competi- 
tion with  American  products,  must  of  necessity  afford 
more  or  less  protection  to  our  home  industries,  and 
hence  is  to  all  intents  and  purposes  2,  protective  tariff. 

The  principle  of  industrial  protection,  whether  em- 
bodied in  what  may  be  called  a  protective  tariff,  a  rev- 
enue tariff,  or  a  tariff  by  any  other  name,  when  properly 
and  honestly  applied  will  undoubtedly  be  productive  of 
benefit  to  the  country.  I  have  no  quarrel,  therefore, 
with  Major  McKinley  to  this  extent.  I  am  a  protection- 
ist to  a  certain  degree,  and  have  been,  and  propose  to 
•continue  to  be.     But  I  fear  he  has  leaped  to  a  dangerous 

(6) 


PREFACE. 


extreme.  It  is  the  abuse  of  the  principle  of  protection 
by  the  imposition  of  exorbitant  duties  for  the  benefit  of 
comparatively  few  industries  which  have  no  excep- 
tional claim  to  public  favor,  to  which  I  object,  and 
against  which  I  desire  to  record  my  emphatic  protest. 

Protection  when  diverted  from  its  legitimate  course, 
and  used  to  promote  the  interest  of  cliques  and  com- 
bines may  be  rendered  as  dangerous  to  the  country  as 
liberty  when  it  degenerates  into  unbridled  license.  The 
abuse  of  the  one  leads  to  high-handed  robbery,  the 
abuse  of  the  other  to  red-handed  anarchy. 

If  legislation  could  prevent  the  organization  of 
trusts  and  pools  under  a  high  tariff,  the  interests  of  the 
unprotected  masses  might,  perhaps,  in  the  main,  be 
safely  left  to  home  competition,  but  Congress  has  thus 
far  failed  to  provide  a  barrier  against  the  extending 
evils  resulting  from  commercial  combinations,  and 
hence  those  tempted  by  the  prospect  of  exorbitant  profits 
to  engage  in  business,  often  find  it  easier  and  more 
profitable  to  join  the  combines  than  to  fight  them,  so 
that  in  certain  lines  there  is  now  practically  no  competi- 
tion and  no  wholesome  check  on  prices. 

Geographically,  Ohio  stands  midway  between  the 
great  wheat,  corn  and  cattle-growing  regions  of  the 
West,  and  the  great  manufacturing  and  mining  districts 
of  the  East.  Combined  on  her  own  soil  in  fair  propor- 
tions, are  all  the  natural  resources  and  elements  of 
wealth  of  which  either  of  the  sections  named,  or  both 
of  them,  can  boast.  Her  position  in  the  family  of  States, 
and  the  commingling  within  her  boundaries  of  all  the 
interests  and  industries  of  the  two  extremes,  would  of 


themselves  suggest  that  she  should  occupy  middle 
ground  in  this  struggle  between  the  manufacturers  who 
demand  more  bounty,  and  the  farmers  and  unprotected 
laborers  who  insist  upon  less  taxation. 

We  should  say  to  the  one  you  shall  not,  if  we  can 
prevent  it,  be  needlessly  injured  by  foreign  competition, 
and  to  the  other,  you  shall  not  be  mercilessly  oppressed 
by  the  trusts  and  combines  which  develop  and  multi- 
ply under  high  protection. 

The  Republicans  of  Ohio,  as  will  be  seen  from  their 
State  platforms,  have  for  many  years  held  tenaciously  to 
this  safe  middle  ground.  If  they  abandon  it  now  under 
the  leadership  of  Major  McKinley  they  may  expect 
hereafter  to  lift  up  their  voices  in  lamentation  oftener 
than  in  songs  of  triumph. 

Against  Republicans  who  adhere  to  the  old  doctrine, 
and  refuse  to  aid  in  committing  the  party  to  the  new, 
the  senseless  cry  of  "  free  trader  "  will  be  hurled,  but 
the  accusation  will  be  false  and  harmless.  The  man 
who  has  been  carried  by  the  inconsiderate  and  reckless 
driving  of  his  party  leaders  away  from  his  true  position 
and  natural  abiding  place,  would  be  weak  indeed  if  he 
refused  to  travel  the  road  which  led  to  his  own  home, 
because  it  stretched  many  miles  beyond  his  proper  res- 
idence, and,  perhaps,  terminated  in  a  morass. 

January^  j8^^. 


THE  LINES  ON  WHICH  AN  HONEST  AND  WHOLESOME  TARIFF  LAW 

MAY   BE   DRAWN,   AND  THE   EXTENT   TO   WHICH  THE 

PRINCIPLE    OF    PROTECTION     MAY    BE 

ADVANTAGEOUSLY  APPLIED. 


"  Duties  should  be  so  high_tliat  our  manufacturers  can  fairly 
compete  with  the  foreigu  product,  but  not  so  high  as  to  enable 
them  to  drive  out  the  foreign  article,  enjoy  a  monopoly  of  the 
trade,  and  regulate  the  j^rice  as  they  please.  This  is  my  doctrine 
of  protection.  If  Congress  pursues  this  line  of  policy  steadily, 
we  shall,  year  by  year,  a^aproach  more  nearly  to  the  basis  of  free 
trade,  because  we  shall  be  more  nearly  able  to  compete  with  other 
nations  on  equal  terms.  I  am  for  a  protection  which  leads  to  ulti- 
mate free  trade.  I  am  for  that  free  trade  which  can  only  be 
achieved  through  a  reasonable  protection. 

"Mr.  Chairman,  examining  thus  the  possibilities  of  the  sit- 
uation I  believe  that  the  true  course  for  the  friends  of  protection 
to  pursue  is  to  reduce  the  rates  on  imports  wherever  we  can  justly 
and  safely  do  so,  and,  accepting  neither  of  the  extreme  doctrines 
urged  on  this  floor,  endeavor  to  establish  a  stable  policy  that  will 
commend  itself  to  all  patriotic  and  thoughtful  people. 

"Modern  scholarship  is  on  the  side  of  free  trade." — James  A. 
Garfield. 

"  But  the  protection  should  be  confined  to  cases  in  which 
there  is  good  ground  of  assurance  that  the  industry  M'hich  it  fos- 
ters will  after  a  time  be  able  to  dispense  with  it;  nor  should  the 
domestic  producers  ever  be  allowed  to  expect  that  it  will  be  con- 
tinued to  them  beyond  the  time  necessary  for  a  fair  trial  of  what 
they  are  capable  of  accomplishing." 

"The  expenses  of  production  being  always  greatest  at  first, 
it  may  happen  that  the  home  production,  though  really  the  most 
advantageous,  may  not  become  so  until  after  a  certain  duration 

^9) 


10  KXTEXT  TO  Vi'HlCH  PROTECTION  MA  V  BE  APPLIED. 

of  poeuniary  loss,  wliich  it  is  not  to  lie  expected  that  private  spec- 
ulators should  incur  iu  order  that  their  successors  may  be  benefited 
by  their  ruin.  I  have  therefore  conceded  that  in  a  new  country, 
a  temporary  protecting  duty  may  sometimes  be  economically  de- 
fensible ;  on  condition,  however,  that  it  be  strictly  limited  in  point 
of  time,  and  provision  be  made  that  during  the  latter  part  of  its 
existence  it  be  on  a  gradually  decreasing  scale.  Such  temporary 
protection  is  of  the  same  nature  as  a  patent,  and  should  be  gov- 
erned by  similar  conditions." — John  Stuart  Mill. 

"If  then  a  nation  be  so  situated,  that  a  protective  tariflf'  is 
necessary  as  a  means  of  introducing  manufactures,  or  any  new 
form  of  productive  labor  which  it  is  desirable  to  have,  there  can 
be  no  doubt  of  the  wisdom  of  such  a  measure,  provided,  the  new 
torm  of  industry  is  one  that  is  so  well  adapted  to  the  people  and 
the  country,  that  when  once  introduced,  ic  can  be  carried  on  with 
profit,  and  without  continued  protection." — Prof.  W.  D.  Wilson. 


I. 

garfield's  position  on  the  tariff  question  — 
m'kinley's  claim  that  a  revenue  tariff  is 
inconsistent  with  protection  considered  — 
who  pays  the  tax  or  duty  —  does  a  duty  on 
foreign  goods  increase  the  price  of  domes- 
tic products. 

Any  duty,  however  small  it  may  be,  upon  any  article 
the  like  of  which  is  manufactured  in  this  country,  af- 
fords protection  to  American  manufacturers.  It  is  not 
necessary  to  make  the  duty  prohibitory  in  order  to  ren- 
der it  protective.  No  considerable  number  of  men  in 
this  country  advocate  free  trade ;  there  is,  in  fact,  no 
free  trade  party,  but  there  are  multitudes  of  intelligent 
Republicans  who  hold  with  Garfield  "  that  one  extreme 
school  of  economists  would  place  the  price  of  all  manu- 
factured articles  in  the  hands  of  foreign  producers  by 
rendering  it  impossible  for  our  manufacturers  to  com- 
pete with  them ;  while  the  other  extreme  school,  by 
making  it  impossible  for  the  foreigner  to  sell  his  com- 
peting wares  in  our  market,  would  give  the  people  no 
immediate  check  upon  the  prices  which  our  manufac- 
turers might  fix  for  their  products.  I  disagree  with 
both  of  these  extremes.  I  hold  that  a  properly  adjusted 
competition  between  home  and  foreign  products  is  the 
best  gauge  by  which  to  regulate  international  trade." 

(11) 


12  WHO  PAi'S  THE    TAX  OR  DUTY. 

"A  reveuuo  tariff  is  inconsistcut  with  protection,  it  is  in- 
teuded  for  ti  wliolly  dillereut  purijose.  It  loses  its  force  and  char- 
acter us  a  genuine  revenue  tariff  when  it  becomes  to  any  extent 
protective.  It  has  but  one  object.  It  can  have  but  one  effect  —  that 
of  opening  up  our  markets  to  tlie  foreign  producer,  impoverishing 
the  liome  producer  and  enriching  his  foreign  rival."' 

The  people  of  this  country  understand  a  revenue 
tariff  to  mean  the  imposition  of  a  tax  or  duty  on  im- 
ports from  which  at  present  the  country  must  of  neces- 
sity obtain  over  ;^200,000,000  per  annum  in  way  of  rev- 
enue, and  this  large  amount  of  money  must,  to  satisfy 
the  people,  be  derived  in  the  main  from  what  are  known 
as  articles  of  convenience  and  luxury.  It  would  be  im- 
possible, therefore,  to  obtain  this  vast  sum  without  af- 
fording more  or  less  protection  to  home  products. 

The  line  of  demarkation  where  a  tariff  for  revenue, 
with  protection  as  the  incident  ends,  and  a  tariff  for  pro- 
tection with  revenue  as  the  incident  begins,  is  some- 
what obscure  and  hence  difficult  to  trace.  But  the  peo- 
ple understand  exactly  the  difference  between  a  low  tax 
and  a  high  tax ;  between  a  low  duty  and  a  high  duty, 
and  imderstand  also  in  a  general  way  that  a  high  pro- 
tective tariff  has  for  its  primary  object,  not  the  revenue 
needed  to  support  the  government,  but  the  exemption 
from  foreign  competition  which  it  will  afiford  to  certain 
manufacturers  and  producers. 

The  revenue  tariff  favored  by  the  Republicans  of 
Ohio  in  their  old  platforms  did  not  contemplate  raising 
the  revenue  referred  to  from  tea,  coffee  and  other  non- 
American  products,^  but  from  such  articles  of  foreign 

1  Major  ISIcKinley  at  Atlanta.  1888. 

=*  The  revenue  tariff  of  1846  imposed  no  duty  on  tea  and  coffee. 


IVHO  PAYS  THE    TAX  OR  DUTY.  13 

make  and  growth  as  might  come  into  competition  with 
our  own  products.  It  was  their  purpose,  however,  to 
make  this  duty  or  tax  so  low  that  it  would  be  impossi- 
ble for  trusts  or  combines  to  destroy  competition,  control 
the  home  market  and  extort  from  consumers,  and  yet 
high  enough  to  afford  a  fair  margin  of  protection  to 
such  American  industries  as  could,  without  too  great  a 
waste  of  labor  and  capital,  ultimately  render  themselves 
self-supporting.  It  certainly  never  was  their  intention 
to  expend  two  dollars'  worth  of  labor  in  the  production 
of  one  dollar's  worth  of  goods,  and  to  continue  this  los- 
ing business  indefinitely  by  exacting  tribute  from  more 
profitable  industries. 

"  Under  this  sj'stem  (the  protective  sj'stem)  if  the  foreign  pro- 
ducer would  enter  our  market  with  a  competing  product,  he  must 
contribute  something  for  the  x^Tw'dege  u'hich  he  is  to  enjoy,  and  this 
something,  in  the  form  of  duties,  goes  into  the  treasury,  furnishing 
revenue  to  the  Government,  and  these  duties  operate  to  protect  the 
joint  product  of  labor  and  capital  against  a  like  foreign  product."^ 

It  will  be  observed  that  here  Major  McKinley  affirms 
that  it  is  the  foreign  producer  and  not  the  consumer  who 
pays  our  customs  taxes !    Four  questions  are  suggested  : 

1.  Does  a  duty  or  tariff  tax  on  imported  goods 
make  the  goods  dearer  in  the  American  market  than  in 
the  foreign  ?  ^ 

1  Atlanta. 

2  In  October,  1871,  occurred  the  great  fire  in  Chicago.  In  the 
winter  following  a  bit  of  legislation  took  place  in  Cougress  in  conse- 
quence, which  unmistakably  shows  the  sense  of  that  body  to  be  that 
tariff  taxes  raise  the  price  of  home  products.  A  bill  received  the 
signature  of  President  Grant  April  5,  1872,  which  had  passed  both 
Houses  by  large  majorities,  to  exem.jit  for  one  year  all  building 
material,  except  lumber,  from  the  operation  of  tariff  taxes  for  the 
benefit  of  Chicago  alone. Prof.  A.  L.  Perry. 


14  lyHO  PAYS  THE  TAX  OR  DUTY. 

2.  If  SO,  does  the  consumer  pay  this  higher  price 
when  he  buys  foreign  goods  ? 

3.  Does  a  duty  levied  upon  foreign  goods  increase 
the  price  of  domestic  goods  of  like  character  ? 

4.  If  so,  does  the  consumer  pay  this  increased  price 
when  he  purchases  domestic  goods? 

As  to  the  first  and  second  questions,  it  is  only  nec- 
essary in  this  brief  discussion  to  say,  if  the  tarifif  does 
not  enhance  the  price  to  the  consumer,  it  affords  no 
shadow  of  protection.  For  if  English  goods  may  be 
bought  in  our  market  as  cheaply  after  the  tarifif  as  be- 
fore, English  competition  continues  as  great  after  the 
tarifif  as  before,  and  our  demand  for  foreign  goods  is  in 
no  way  afifected  by  the  law.  And  so  long  as  this  de- 
mand is  not  diminished  by  an  increase  of  prices  the 
supply  will  be  afiforded  to  satisfy  it,  and  so  long  as  the 
old  demand,  the  old  supply  and  the  old  price  continue* 
no  protection  or  advantage  can  possibly  accrue  under  a 
tarifif  law  to  the  home  manufacturer,  and  hence  the  en- 
actment of  such  a  law,  except  for  purposes  of  revenue 
would  be  utter  folly. 

Major  McKinley's  assumption  that  a  tax  does  not 
increase  the  price,  and  that  an  increased  price  is  not 
paid  by  the  consumer  may  find  a  shadowy  support  on 
the  ground  that  what  diminished  supply  adds  to  the 
price,  diminished  consumption  deducts;  but  this  hy- 
pothesis fails  to  take  into  account  the  fact  that  goods 
cannot  be  made  and  sold  for  less  than  cost  of  produc- 
tion, plus  taxes  and  a  reasonable  profit  to  the  middle 
man,  and  therefore  necessarily  involves  an  inability  to 


WHO  PAYS  THE  TAX  OR  DUTY. 


15 


satisfy  reasonable  wants  distressing  to  the  people,  and 
hence  inadmissible  in  any  just  scheme  of  legislation. 

Protection,  does  protect ;  it  does  so  by  making  for- 
eign goods  dearer  to  the  consumer  to  just  the  extent  of 
the  duty  paid.  By  increasing  the  price  of  foreign 
goods  it  deters  many  people  from  buying  them,  and 
tends  to  give  home  products  a  monopoly  of  the  home 
market,  to  the  disadvantage  often,  if  not  generally,  of 
the  consumer. 

According  to  Major  McKinley's  theory,  the  foreign 
manufacturer  of  all  goods,  the  duty  on  which  is  a  hun- 
dred per  cent,  and  over,  pays  not  less  than  one  dollar 
into  the  United  States  treasury  for  the  poor  privilege  of 
selling  a  dollar's  worth  of  goods  for  a  dollar,  and  when 
the  duty  is  350  per  cent.,  as  it  is  on  some  articles,  the 
manufacturer  pays  two  dollars  and  fifty  cents  for  per- 
mission to  give  away  a  dollar's  worth  of  his  products. 

As  to  the  third  and  fourth  questions.  It  may  be 
said  briefly  that  if  a  protective  tariff  does  not  in  some 
degree  lessen  competition  by  the  exclusion  of  foreign 
products,  and  thereby  advance  prices,  it  fails  wholly  to 
benefit  those  for  whose  protection  and  advantage  it  is 
adopted.  Nobody  would  want  a  protective  tariff  if  its 
effect  were  not  to  shut  out  competition,  and  increase 
profits  of  the  home  maker  and  producer ;  and  whenever 
prices  are  advanced  by  either  natural  or  artificial  causes 
the  buyer  and  consumer  must  of  necessity  pay  the  ad- 
vance, for  the  simple  reason  that  nobody  else  will  do  so. 
Why  did  the  Ohio  wool  grower  want  a  duty  on  foreign 
wool  ?  To  increase  the  price.  Why  did  the  Louisiana 
sugar  planter  demand,  in  the  old  time,  that  a  duty  be 


16  IVHO  PAYS   THE   TAX  OR  DUTY. 

imposed  on  foreign  sugar?  To  increase  the  price. 
This  is  the  purpose  of  a  protective  tariff,  and  if  this 
were  not  its  direct  effect  such  a  law  would  neither  be 
asked  for  nor  tolerated  by  either  manufacturer  or  pro- 
ducer. So  that  Major  McKinley's  argument  with  re- 
spect to  these  questions  is  illogical  and  inconsistent. 

"A  revenue  tariff  invites  the  product  of  foreign  labor  and 
foroigu  capital  to  occupy  our  markets  free  and  uurestrained  iu 
competition  with  the  product  of  our  own  labor  and  capital." 

A  duty  levied  is  not  a  bonus  paid  or  promised,  and 
hence  can  neither  be  an  encouragement  nor  an  invi- 
tation. 

"  It  is  alleged  as  a  serious  objection  to  protective  duties  that 
the  tax,  whatever  it  may  be,  increases  the  cost  of  the  foreign  as 
well  as  the  domestic  product  to  the  extent  of  such  tax  or  duty, 
and  that  it  is  wholly  paid  by  the  consumer.  This  objection  would 
be  worthy  of  serious  consideration  if  it  were  true,  but  as  has  been 
demonstrated  over  and  over  again  it  is  without  foundation  in 
fact." 

Such  a  demonstration  if  it  could  be  made,  would 
defeat  the  very  end,  purpose  and  intent  of  a  protective 
tariflf,  for  if  dutiable  foreign  goods  could  be  sold  as 
cheaply  in  this  country  as  the  non-dutiable,  the  home 
producer  would  have  no  protection,  and  the  imposition 
of  a  duty  for  any  purpose  except  revenue  would  be 
sheerest  folly.  Major  McKinley  may,  perhaps,  with 
some  show  of  truthfulness,  affirm  that  the  tax  or  duty 
imposed  on  foreign  products  does  not  always  enhance 
the  price  of  domestic  products  of  like  kind  to  the  full 
extent  of  such  duty  or  tax,  but  no  sane  man  will  claim 
that  the  duty  on  imported  sugar  under  the  old  law  was 
not  paid  by  the  consumer;    nor  can  it  be  truthfully 


WHO  PAYS  THE  TAX  OR  DUTY.  il 

maintained  that  the  duty  on  tobacco  and  cigars  under 
the  new  law  is  not  paid  by  those  who  use  them.' 

"Wherever  the  foreign  product  hsLS  successful  competition  aX 
home,  the  duty  is  rarely  paid  by  the  consumer.    It  is  paid  from 

^  "  We  do  not  derive  our  ability  from  abroad  to  pay  taxes. 
That  depends  upon  our  wealth  and  our  industry;  and  it  is  the 
same,  whatever  may  be  the  form  of  levying  the  public  contribu- 
tions.    .     .     ."—Henry  Clay,  April  26,  1820. 

''The  duty  constitutes  a  part  of  the  price  of  the  whole  mass 
of  the  article  in  the  market.  It  is  substantially  paid  upon  the  ar- 
ticle of  domestic  manufacture  as  well  as  upon  that  of  foreign  pro- 
duction. Upon  one  it  is  a  bounty,  upon  the  other  a  burden  ;  and 
the  repeal  of  the  tax  must  operate  as  an  equivalent  reduction  of 
the  price  of  the  article,  whether  foreign  or  domestic.  We  say,  so 
long  as  the  importation  continues,  the  duty  must  be  paid  by  the 
purchaser  of  the  article." — John  Quincy  Adams^  Report  on  Manu- 
factures, 1835. 

"  I  said  it,  and  I  stand  by  it,  that  as  a  general  rule  the  duties 
paid  upon  imports  operate  as  a  tax  upon  the  consumer.  A  few 
years  of  further  experience  will  convince  the  whole  body  of  our 
people  that  a  system  of  national  taxes  which  rests  the  whole  bur- 
den of  taxation  on  consumption  and  not  entirely  on  property  or 
income  is  intrinsically  unjust. — Hon.  John  Sherman,  1867. 

"Who  pay  these  taxe*?  When  the  manufacturer  of  iron 
comes  to  the  Senate  and  says :  '  I  can  live  or  I  can  make  a  profit, 
if  a  certain  duty  is  imposed,'  what  is  he  saying?  He  is  simply 
saying,  'if  you  give  me  a  certain  duty  you  put  it  in  my  power  to 
charge  over  that  duty  as  an  additional  tax  on  the  farmers  of  the 
United  States.'  " — Senator  Preston  B.  Plumb,  1883. 

"  Our  goods  (American  manufactures)  are  now  met  by  foreign 
goods  on  our  own  shores  at  a  price  made  up  of  raw  material,  plus 
labor,  and  plus  the  j}7^esent  rate  of  duty,  on  very  nearly  equal 
terms." — Minority  report  (Rei)ublican)  Ways  and  Means  Com- 
mittee on  Wilson  bill  {53rd  Congress)  page  3. 

Again  on  page  7  same  report.  "The  honest  merchant  who 
values  them  (imported  goods)  at  their  true  market  value  and 
pays  the  duty  demanded  by  the  government,"  etc. 

Again  on  page  28  of  same  report.  "The  American  manufac- 
turer has  been  receiving  38  cents  for  eaeli  dozen  spools  (of  cotton 
thread)  containing  200  yards,  and  the  English  manufacturer  only 
28  cents  for  the  same  quantity  and  (juality  of  goods." 


18  H'HO  PAYS  THE  TAX  OR  DUTY. 

the  profits  of  the  manufacturer,  or  divided  between  him  and  the 
merchant  or  the  importer,  and  diminishes  their  profit  to  that 
extent." 

Competition  to  be  successful  must  command  the 
market,  and  where  the  home  product  does  this  the 
foreign  product  does  not  sell  at  all,  and  hence  will  not 
as  a  rule  be  oflfered  for  sale,  and  will  not  be  imported. 
Nobody  ever  offers  an  English  hoe  or  fork  or  farm 
wagon  for  sale  in  this  country,  and  if  anybody  did  he 
would  be  compelled  to  sell  at  a  loss,  for  the  article  can 
be  made  cheaper  here  than  in  any  other  quarter  of  the 
globe.  The  foreign  product  would  have,  in  this  in- 
stance, what  Major  McKinley  calls  "  successful  compe- 
tition at  home,"  and  if  by  accident  a  foreign-made  hoe 
or  fork  or  farm  wagon  were  sent  here  for  sale  it  would 
be  sold  at  a  loss  to  the  sender,  and  the  duty  thereon,  if 
duty  there  was,  would  not  be  paid  b}'  the  consumer. 
But  foreign  manufacturers  are  not  so  unwise  as  to  ship 
their  wares  to  points  where  there  is  no  demand  for 
them.  On  the  contrary  the  American  importer  does 
the  buying,  and  like  the  country  merchant,  he  buys 
only  what  he  thinks  he  can  sell  at  a  profit ;  and  in  foot- 
ing up  the  cost  of  the  goods  he  buys,  he  adds  to  the 
sum  paid  the  foreign  manufacturer  the  money  paid  for 
transportation  and  the  custom  house  taxes,  and  all  three 
items,  to-wit,  the  original  cost  abroad,  the  cost  of  trans- 
portation and  the  customs-tax,  the  consumer  pays. 
That  there  may  be  occasional  exceptions  to  this  rule 
resulting  from  stringency  in  money,  failure  of  merchant 
or  importer,  accidental  over-supply  of  certain  lines  of 
goods,   or  an  unanticipated  diminution  of  demand,  is 


IVHO  PAYS  THE  TAX  OR  DUTY.  19 

freely  admitted,  and  in  such  instances  the  stock  may  be 
sold  at  public  or  private  sale  at  a  sacrifice,  and  in  such 
exceptional  cases  the  consumer  would  neither  pay  for 
the  original  cost  of  the  goods,  the  import  duties,  nor 
the  importer's  legitimate  profit.  It  would  be,  in  short, 
a  forced  sale,  and  the  price  paid  might  not  be  one-half 
the  value  of  the  articles  sold. 

"  There  is  not  in  the  long  line  of  staple  products  consumed  by 
the  people  a  single  one  which  has  not  been  cheapened  by  compe- 
tition at  home,  made  possible  by  protective  duties.  There  is  not 
an  article  that  enters  into  the  every  day  uses  of  the  family,  which 
is  produced  in  the  United  States,  that  has  not  been  made  cheaper 
and  more  accessible  as  the  result  of  home  production  and  develop- 
ment which  was  to  be  secured  only  by  the  sturdy  maintenance  of 
the  protective  system." 

If  Major  McKinley's  theory  as  to  the  cheapening  ef- 
fects of  the  protective  system  were  sound,  all  nations 
would  be  hastening  here  to  buy  our  products,  and  Eng- 
land would  be  the  dearest  market  in  the  world.' 

'  "Just  so  far  as  prices  of  the  jDrotected  article  in  the  market 
are  enhanced  by  the  tariff,  all  consumers  pay  a  special  tax  for  the 
benefit  of  the  favored  producer."— Z>r.  Chapin. 


II. 


THE  LOW  TARIFF  PERIODS  CONTRASTED  WITH 
THE  HIGH  TARIFF  PERIODS  —  TESTIMONY  OF 
WELLS,  ALLISON  AND  BLAINE  AS  TO  THE  CONDI- 
TION OF  THE  COUNTRY  UNDER  THE  LOW  TARIFF 
OF  1846  —  BLAINE'S  SUBSEQUENT  ATTEMPT  TO 
BREAK  THE  FORCE  OF  HIS  OWN  ADMISSIONS  — 
SCHURZ'S  REJOINDER  —  REPUBLICAN  NATIONAL 
PLATFORM  OF  1856  AND  THE  ACTION  OF  THE 
THIRTY-FOURTH  CONGRESS. 

"The  revenue  tariff  periods  of  our  history  have  been  periods 
of  greatest  financial  revulsions  and  industrial  decadence,  want 
and  poverty  among  the  people,  private  enterprises  checked  and 
public  works  retarded.  From  1833  to  1842,  under  the  low  tariff 
legislation  then  prevailing,  business  was  at  a  stand  still  and  our 
merchants  and  traders  were  bankrupted  ;  our  industries  were  par- 
alyzed, our  labor  remained  idle,  and  our  capital  was  unemployed. 
Foreign  products  crowded  our  markets,  destroyed  domestic  com- 
petition, and,  as  invariably  follows,  the  prices  of  commodities  to 
consumers  were  appreciably  raised.  It  is  an  instructive  fact  that 
every  panic  this  country  has  ever  experienced  has  been  preceded 
by  enormous  importations." 

Major  McKinley  seems  to  have  forgotten  that  one  of 
the  most  violent  and  destructive  of  all  panics,  that  of 
1873,  occurred  under  the  high  protective  system. 

Fifty  years  ago  the  pioneers  of  Ohio  were  struggling 
■with  the  forest,  and  their  few  open  fields  were  studded 
with  stumps ;  railroads  were  unknown,  and  wagon 
roads  at  certain  seasons  of  the  year  impassable.  Their 
houses  were  huts,  and  their  live  stock  was  unsheltered. 
(20) 


THE  REVENUE    TARIFF  PERIODS.  21 

Grain  was  cut  with  the  cradle  and  sickle ;  the  fields 
prepared  for  seed  time  by  use  of  the  grubbing  hoe  and 
wooden  plow.  During  many  years  of  the  period  re- 
ferred to  by  Major  McKinley,  their  capital  was  imag- 
inary ;  their  banks'  shaving  shops  and  their  currency 
"wildcat." 

The  great  States  west  of  Indiana  were  then  almost 
unknown,  and  wholly  undeveloped.  The  States  east 
of  us  were  more  densely  settled  than  Ohio,  and  their 
people  lived  in  better  houses,  but  they,  like  ourselves, 
were  afflicted  with  a  rotten  currency  and  a  craze  for 
speculation  similar  to  that  which  has  recently  run  like 
a  prairie  fire  through  Kansas  and  Southern  California, 
bankrupting  tens  of  thousands.  What  portion  of  the 
financial  and  industrial  troubles  of  the  people  from 
1833  to  1842  should  be  attributed  to  an  unsound  cur- 
rency ;  to  the  credit  system ;  to  wild  speculation ;  to 
unfavorable  surroundings ;  and  what  portion  to  the  ab- 
sence of  a  proper  tariff  law,  it  would  take  a  wiser  man 
than  Solomon  to  determine,  and  yet  this  is  true,  to-wit: 
Wages  in  Massachusetts  advanced  from  the  high  tariff 
period  ending  with  1830,  through  the  low  tariff  period 
ending  with  1860,  fifty-two  per  cent.,  while  they  ad- 
vanced from  1860  to  1883,  only  twenty-eight  per  cent.' 

"From  1846  to  1861  a  similar  situation  was  presented  under 
the  low  tariff  of  that  period." 

When  Major  McKinley  asserts  that  during  the  low 
tariff  period  beginning  with  1846  and  ending  with  1861, 
the  country  was  not  prosperous,  he  makes  a  statement 

*  Mass.  Labor  Rep.,  1885. 


22  THE  REVENUE  TARIFF  PERIODS. 

contradicted  by  history  and  by  the  vivid  recollection  of 
thousands  of  living  witnesses.  Mr.  David  A.  Wells ' 
says:  "This  tariflf  continued  in  force  for  ten  years, 
from  1847  to  1857.  During  its  existence  the  American 
mercantile  marine  touched  its  highest  point  of  prosper- 
ity, nearly  equaling  in  point  of  tonnage  that  of  Great 
Britain.  *  *  *  There  was  also  an  increase  in  nearly 
everything  else  pertaining  to  business.  These  were  the 
years  in  which  nearly  all  of  our  great  cotton  factories 
of  New  England  sprang  into  existence.  *  *  :{= 
Between  1850  and  1860  the  farm  values  of  the  country 
increased  101  per  cent.,  while  during  the  high  tariff 
period  between  1870  and  1880,  they  increased  but  9  per 
cent.,  though  population  increased  30  per  cent.  *  *  * 
Most  marked  of  all,  manufactures  themselves  increased 
during  this  period  90  per  cent.  *  *  *  There  had 
never  been  such  prosperity  before  ;  there  has  never  been 
such  prosperity  since,  as  was  realized  in  the  whole  ten 
years  taken  together  of  this  so-called  '  free  trade '  tariff 
of  1846." 

Senator  William  B.  Allison,^  of  Iowa,  said:  "The 
tariff  of  1846,  although  professedly  and  confessedly  a 
tariff  for  revenue,  was,  so  far  as  regards  all  the  great 
interests  of  the  country,  as  perfect  a  tariff  as  any  we 
ever  had.  *  *  *  We  find  that  the  increase  of  our 
wealth  between  1850  and  1860  was  equivalent  to  126  per 
cent." 

Mr.  Blaine  3  said:     "The  tariff  of  1846  was  yielding 

^  Speech  at  New  London,  Conn.,  1890. 

-^  U.  S.  Senate,  1872. 

3  Twenty  Years  in  Congress. 


THE  REVENUE  TARIFF  PERIODS.  23 

abundant  revenue,  and  the  business  of  the  country  was 
in  a  flourishing  condition.  Money  became  very  abund- 
ant after  the  year  1849  ;  large  enterprises  were  under- 
taken ;  speculation  was  prevalent,  and  for  a  considerable 
period  the  prosperity  of  the  country  was  general  and 
apparently  genuine.  *  *  *  Xhe  principles  involved 
in  the  tariff  of  1846  seemed  for  the  time  to  be  so  en- 
tirely vindicated  and  approved  that  resistance  to  it 
ceased,  not  only  among  the  people,  but  among  the  pro- 
tective economists,  and  even  among  the  manufacturers 
to  a  large  extent.  *  *  *  it  -^as  not  surprising, 
therefore,  that  in  1857  the  duties  were  placed  lower  than 
they  had  been  since  1812.  The  act  was  well  received 
by  the  people,  and  was,  indeed,  concurred  in  by  a  con- 
siderable portion  of  the  Republican  party." 

It  should  in  fairness  be  said  that  in  a  discussion 
with  Carl  Schurz,  Mr.  Blaine  undertook  to  attribute  the 
prosperity  of  the  country  under  the  tariff  of  1846  to 
other  causes,  and  to  deny  that  this  prosperity  resulted 
from  tariff  legislation  ;  but  no  fair-minded  man,  I  think, 
can  read  Mr.  Blaine's  Canton  speech  and  Mr.  Schurz's 
rejoinder  without  coming  to  the  conclusion  that  Mr. 
Blaine's  effort  to  escape  the  force  of  his  own  admissions 
with  respect  to  the  low  tariff  period  was  an  utter  failure. 
But  whether  this  is  true  or  not,  the  fact  remains  that 
Major  McKinley  made  a  palpable  mistake  when  he 
affirmed  that  "  the  revenue  tariff  periods  of  our  history 
have  been  periods  of  greatest  financial  revulsions  and 
industrial  decadence,  want  and  poverty  among  the 
people." 

Major  McKinley  in  a  speech  at  Ada,  Ohio,  during 


24  THE  REVENUE  TARIFF  PERIODS. 

the  gubernatorial  contest  of  1891,  referred  to  this  con- 
troversy between  Schurz  and  Blaine  as  to  the  condition 
of  the  country  under  the  tariff  of  1846,  and  affirmed 
substantially  that  Mr.  Blaine  had  successfully  accounted 
for  the  prosperity  which  then  prevailed,  by  calling  at- 
tention to  certain  accidents  of  the  period  which  had  no 
relation  whatever  to  tarifif  legislation. 

In  order  to  aflford  the  reader  an  opportunity  to  de- 
termine for  himself  whether  Mr.  Blaine  succeeded  in 
his  effort  to  account  for  the  good  times  which  he  ad- 
mits extended  from  1846  to  1857  without  according  any 
credit  to  the  then  existing  tariff,  I  shall  give  the  main 
points  of  his  argument  and  also  those  embodied  in  the 
reply  of  Mr.  Schurz. 

The  fortuitous  circumstances  which  Mr.  Blaine 
alleged  rendered  the  country  prosperous  during  the 
period  covered  by  the  tarifif  of  1846,  were: 

1.  The  Mexican  war,  which  caused  the  government 
to  disburse  one  hundred  millions  in  one  year. 

2.  The  Irish  famine,  which  called  for  extraordinary 
exports  of  bread  stuflfs. 

3.  The  discovery  of  gold  in  California  which  added 
greatly  to  our  wealth. 

4.  The  revolutions  of  1848,  which  "  paralyzed  the 
industrial  energies  of  Europe." 

5.  The  Crimean  war,  which  "paralyzed  France, 
England  and  Russia  for  two  years  and  a  half  in  their 
industries." 

On  the  other  hand,  with  respect  to  the  high  tarifif 
period  since  1861,  Mr.  Schurz  afiSrmed  that: 


THE  REVENUE  TARIFF  PERIODS.  25 

1.  "From  1861  to  1865  we  had  a  war  compared  with  which 
the  Mexican  war  was  a  holiday  excursion  ■"  *  *  causing  the 
government  to  disburse    *    *    many  thousands  of  millions. 

2.  "  Since  1861  there  has  indeed  not  been  agreat  Irish  famine, 
but  not  a  few  crop  failures  and  local  dearths  abroad  to  call  tor  our 
breadstuffs  in  more  than  ordinary  quantity." 

3.  "  The  supply  of  the  newly  discovered  California  gold  did 
not  stop  with  the  end  of  the  low  tariff  period  ;  on  the  contrary, 
while  the  production  of  gold  and  silver  averaged  from  1849,  inclu- 
sive, to  1860,  per  year  $53,400,000;  it  averaged  during  the  twenty 
years  of  the  high  tariff  period  from  1861  inclusive,  to  1880,  as  much 
as  $66,500,000,  and  after  that  over  $80,000,000.  In  addition  to  this 
we  had  to  contribute  to  our  wealth  a  new  product,  petroleum, 
worth  annually  the  output  of  scores  of  gold  and  silver  mines." 

4.  "  There  were  no  revolutions  in  Europe  as  great  as  those  of 
1848,  but  many  smaller  ones,  one  in  Greece  in  1862,  a  Polish  rising 
against  Russia  in  1863,  revolutionary  movements  in  Spain  in  1866 
and  1868;  the  great  Carlist  insurrection  in  the  same  country  in 
1872,"  etc. 

5.  "While  the  revolutions  were  comparatively  limited  there 
was  a  full  supply  of  wars  —  the  French-Mexican  war  from  1862  to 
1867;  the  second  Schleswig-Holsteiu  war  in  1864;  the  great  war 
between  Prussia  and  Austria  in  1866;  the  great  Franco-German 
war  in  1870-1871 ;  the  war  between  Russia  and  Turkey  in  1877- 
1878,  and  several  similar  conflicts.  The  Crimean  war  was  but  a 
petty  affair  compared  with  these  all  together." 

Thus,  it  will  be  observed  that  the  high  tarifif  period 
since  1861  has  been  even  more  favored  by  contributions 
from  our  gold  and  silver  mines  and  by  accidents  of  his- 
tory, than  the  low  tarifif  period  extending  from  1846  to 
1860. 

That  the  tarifif  of  1846  was  not  regarded  by  the  states- 
men, the  manufacturers  and  the  people  of  that  period 
as  objectionable  because  of  the  low  duties  which  it  im- 
posed on  foreign  products,  is  conclusively  shown  by  the 
action  of  the   first    Republican   National  Convention. 


26  THE  REl'EXUE  TARIFF  PERIODS. 

This  convention  was  held  in  Philadelphia  —  the  center 
of  the  protection  sentiment  of  the  country  —  in  1856. 
The  platform  of  principles  and  purposes  which  it  pro- 
mulgated made  no  demand  for  an  increase  of  customs- 
duties.  The  tariff  law  of  1846  was  then  in  force,  and 
the  people  of  the  whole  country  were  not  only  opposed 
to  a  further  increase  of  duties  but  practically  unanimous 
in  favor  of  a  reduction,  and  hence  Democrats,  Republi- 
cans and  Americans  of  the  Thirty-fourth  Congress  united 
in  a  measure  for  the  reduction  of  tariff  rates  and 
passed  the  bill  known  as  the  tariff  act  of  1857.  It  can- 
not be  truthfully  claimed  that  this  law  was  a  Democratic 
measure  and  passed  by  Democratic  influence,  for 
Nathaniel  P.  Banks,  of  Massachusetts,  was  speaker  of 
the  House  of  Representatives  in  which  it  originated, 
and  Republicans  and  Americans — all  Republicans  in 
fact  —  constituted  a  majority  of  that  body. 


III. 


m'kinley's  statistical  argument  in  favor  of  a 
high  tariff  briefly  considered — is  the  fact 
that  a  nation  buys  more  than  it  sells  an 
evidence  of  poor  management  —  the  panic  of 
1857  caused  by  the  failure  of  the  ohio  life 
and  trust  company,  and  not  by  tariff  laws. 
—  does  a  low  tariff  send  money  abroad. 

"  Contrast  this  period  (the  low  tariff  period  from  1846  to  1860) 
with  the  period  from  1860  to  1880,  the  former  under  a  revenue 
tariff,  the  latter  under  a  protective  tariff.  In  1860  we  had  163,000,- 
000  acres  of  improved  land,  while  in  1880  we  had  287,000,000,  an 
increase  of  75  per  cent." 

The  tariflf  never  chopped  down  a  forest  and  thus 
cleared  a  farm. 

"  In  1860  our  farms  were  valued  at  $3,200,000,000 ;  in  1880  the 
value  had  leaped  to  $10,197,000,000,  an  increase  of  over  300  per  cent. 

God   made  the  country,  with  its  hills  of  coal  and 

iron  ;  its  fertile  valleys,  uplands,  and  boundless  plains. 

The  tariff  did  not. 

"  In  1860  we  raised  173,000,000  bushels  of  wheat ;  in  1880,  498,- 
000,000.  In  1860  we  raised  838,000,000  bushels  of  corn  ;  in  1880, 
1,717,000,000  bushels." 

The  tariff  did  not  convert  the  great  prairies  of  the 

west  into  fields  of  wheat,  corn    and   hay,  and   never 

invented  a  reaper,  mower,  binder  or  thresher. 

"  In  I860  we  produced  5,000,000  bales  of  cotton  ;  in  1880,  7,600,- 
000  bales,  an  increase  of  40  per  cent." 

The  tariff  did  not  break  the  shackles  from  4,000,000 

(27) 


28  McKINLEY'S  STATISTICAL  ARGUMENT. 

slaves,  and  make  them  free  and  willing  workers  in  cot- 
ton fields  and  elsewhere. 

"  lu  18G0  we  manufactured  cotton  goods  to  the  value  of  $115,- 
681,774;  in  1880  the  value  reached  $211,000,000,  an  increase  of  up- 
ward of  80  per  cent. 

All  made  from  untaxed  raw  material. 

"In  I860  we  manufactured  of  woolen  goods  $61,000,000;  in 
1880,  $267,000,000,  an  increase  of  333  per  cent." 

If  woolen  goods  are  cheaper  now  than  in  1860,  im- 
proved methods  in  manufacturing,  not  the  tariff,  have 
made  them  so. 

•'  In  1860  we  produced  60,000,000  pounds  of  wool ;  in  1880,  240,- 
000,000  pounds,  an  increase  of  nearly  300  per  cent." 

And  yet  the  wool-grower  gets  less  per  pound  for  his 
wool  now  than  he  did  in  1860.    (Why?  See  wool  page  84.) 

"  In  1860  we  mined  15,000,000  tons  of  coal;  in  1880,  79,000,000, 
an  increase  of  over  400  per  cent." 

We  had  more  wood  in  1860  than  in  1880;  fewer  rail- 
roads to  transport  and  distribute  coal ;  fewer  people  to 
use  it  in  the  Middle  States,  and  comparatively  no  pop- 
ulation at  all  in  the  vast  timberless  regions  of  the  West. 

"In  1860  we  made  987,000  tons  of  pig  iron;  in  1880,  3,835,000 
tons." 

It  is  estimated  that  American  consumers  of  iron  and 

steel,  from  1878  to  1887,  paid  ;^560,000,000  "in  excess 

of  the  cost  of  like  quantity  to  the  consumers  of  Great 

Britain.'" 

"  In  1860  we  manufactured  235,000  tons  of  railroad  iron  ;  and 
in  1880,  1,208,000  tons." 

'  D.  A.  Wells,  Economic  Change--. 


McKINLEY'S  STATISTICAL  ARGUMENT.  29 

Did  a  high  protective  tariflf  ever  build  a  railroad? 
No ;  it  simply  extorts  from  those  who  do. 

"  In  1860  our  aggregate  of  national  wealth  was  $16,159,000,000 ; 
in  1880  it  was  $43,000,000,000." 

How  much  of  this  vast  sum  in  1880  was  in  the  pos- 
session of  the  Andrew  Carnegies,  and  how  much  in  the 
pockets  of  their  employes  ? 

In  spite  of  vicious  legislation  ;  the  schemes  of  polit- 
ical jobbers ;  the  blunders  of  ignorance ;  the  well-meant 
but  mischevious  expedients  of  monomaniacs,  our  people 
have  prospered  as  no  other  people  ever  did  before,  be- 
cause our  advantages  and  opportunities  have  been  vast- 
ly greater  than  any  other  people  ever  enjoyed. 

"From  1848  to  1860,  during  the  low  tariff  period,  there  was 
but  a  single  year  in  which  we  exported  in  excess  of  what  we 
imported  ;  the  balance  of  trade  during  twelve  of  the  thirteen  years 
was  against  us.  Our  people  were  drained  of  their  money  to  pay 
for  foreign  purchases.  We  sent  abroad  over  and  above  our  sales, 
$396,216,161." 

;^396,000,000  in  thirteen  years.  The  people  of  the 
United  States  pay  more  than  this  in  the  way  of  taxes 
every  year  of  their  lives !  But  suppose  the  things  they 
got  in  return  for  the  money  sent  abroad  cost  half  the 
sum  they  would  have  cost  if  manufactured  here,  then 
they  made  a  clear  gain  of  not  less  than  ;^396, 000,000  by 
purchasing  abroad.  Adam  Smith  said :  "  It  is  the 
maxim  of  every  prudent  master  of  a  family  never  to  make 
at  home  what  it  will  cost  him  more  to  make  than  to 
buy."  Jean-Baptiste  Say  said :  "  It  is  most  for  our 
advantage  to  employ  our  productive  powers,  not  in 
those  branches  in  which  foreigners  excel   us,   but  in 


30  McK/NLEV'S  STATISTICAL  ARGUMENT. 

those  which  we  excel  in  ourselves,  and  with  the  prod- 
uct to  purchase  of  others." 

It  may  be,  therefore,  that  the  prosperity  which  Mr, 
Blaine  and  others  tell  us  prevailed  from  1846  to  1860 
resulted  to  some  extent  from  an  adherence  in  part,  if 
not  in  whole,  to  the  principles  which  the  greatest  of 
political  economists  affirm  should  govern  us  in  our  in 
ternational  as  well  as  domestic  exchanges. 

'*  During  the  last  thirteen  years,  under  a  protective  tariff, 
there  was  but  one  year  that  the  balance  of  trade  was  against  us. 
For  twelve  years  we  sold  to  our  foreign  customers  in  excess  of 
what  we  bought  from  them  $1,612,659,755.  This  contrast  makes 
an  interesting  exhibit  of  the  work  under  the  two  systems.  You 
need  not  be  told  that  the  government  and  the  people  are  most 
prosperous  whose  balance  of  trade  is  in  their  favor.  The  govern- 
ment is  like  the  citizen  ;  indeed  it  is  but  an  aggregation  of  citizens, 
and  when  the  citizen  buys  more  than  he  sells  he  is  soon  conscious 
that  his  year's  business  has  not  been  a  success." 

This  argument  seems  plausible,  but  it  is  neverthe- 
less utterly  unsound  and  hardly  worthy  of  serious 
consideration.  Kad  Major  McKinley  told  us  that  when 
the  citizen  consumes  more  than  he  produces,  and  hence 
has  left  at  the  end  of  the  year  less  than  he  had  in  hand 
at  the  beginning,  he  is  on  the  high  road  to  bankruptcy, 
we  should  have  accepted  it  as  the  statement  of  a  self- 
evident  and  wholesome  truth.  But  a  moment's  reflec- 
tion must  convince  anyone  that  a  majority  of  Ameri- 
cans, whether  engaged  in  agriculture,  manufactures, 
trade  or  other  pursuits,  during  many  years  of  their 
lives,  buy  more  than  they  sell  and  become  rich  and 
prosperous  by  so  doing.  This  is  especially  true  of  the 
younger,  more  vigorous  and  enterprising  element  of  our 


McKINLEVt,  STATISTICAL  ARGUMENT.  31 

business  population.  The  man  who  buys  a  farm,  who 
builds  a  house,  mill  or  manufactory,  the  men  who  con- 
struct a  railroad,  open  a  coal  mine,  build  a  vessel,  erect 
a  hotel,  purchase  improved  breeds  of  horses,  cattle, 
sheep,  or  swine,  generally  buy,  during  some  years  of 
their  lives,  more  than  they  sell,  and  confidently  look  to 
future  years  for  a  return  of  their  money  increased  many 
fold. 

That  "the  people  are  always  the  most  prosperous 
whose  balance  of  trade  is  in  their  favor,''  is  not  more 
true  of  nations  than  of  individuals.  When  articles  of 
permanent  value  are  purchased,  profit  is  more  likely  to 
result  to  the  purchaser  from  the  transaction  than  loss. 
And  even  when  such  merchandise  is  bought,  as  may  be 
consumed  within  the  year,  the  purchase  is  often  if  not 
always  an  indication  of  the  presence  of  accumulated 
capital ;  of  financial  prosperity ;  not  of  penury  and  want. 
The  most  prosperous  people  are  often  the  most  extrav- 
agant. Those  who  have  money  may  spend  it ;  those 
who  have  none  cannot.  The  rich  may  sell  their  pro- 
ducts ;  the  poor  must.  The  balance  of  trade  which  was 
against  us  during  the  revenue  tariff  period  to  which 
Major  McKinley  refers,  could  not  have  indicated  a  lack 
of  prosperity  in  this  country,  for  Mr.  Blaine  and  hun- 
dreds of  others  bear  witness  to  the  fact  that  money  was 
then  abundant,  speculation  prevalent,  and  the  country 
in  a  most  flourishing  condition.  A  better  condition, 
Mr.  Schurz,  Mr.  Wells,  and  others  tell  us,  than  it  ever 
was  in  before,  or  ever  has  been  in  since. 

In  order  to  prove  that  the  revenue  tariflf  of  1846  was 
injurious  to  the  country,  I  observe  that  at  Lakeside 


32  Ar-.'.'/XLEY'S  STA  TISTICAL  ARGUMENT. 

recently  (1891)  Major  McKinley  read  from  President 
Buchanan's  message  of  December,  1<S57,  as  follows: 

''  In  the  midst  of  unsurpassed  plenty  in  all  the  pro- 
ductions and  in  all  the  elements  of  national  wealth,  we 
•find  our  manufactures  suspended,  our  public  works 
retarded,  our  private  enterprises  ot  different  kinds 
abandoned,  and  thousands  of  useful  laborers  thrown  out 
of  employment  and  reduced  to  want." 

But  Major  McKinley,  although  addressing  an  audi- 
ence composed  of  good  Christian  people,  was  especially 
careful  not  to  tell  them  the  whole  truth.  On  August 
25,  three  months  before  President  Buchanan's  message 
was  published,  the  New  York  branch  of  the  The  Ohio 
Life  and  Trust  Company  suspended  payment  and  pre- 
cipitated the  great  panic  of  1857,  which  was  only  a 
shade  less  violent  and  disastrous  to  the  business  inter- 
ests of  the  country  than  the  panic  which  resulted  from 
the  failure  of  Jay  Cooke  &  Co.  in  1873.  The  same  logic 
which  would  attribute  the  panic  of  1857  to  a  revenue 
tariff  should  attribute  the  panic  of  1873  to  a  protective 
tariff;  but  I  apprehend  that  no  fair  man  would  do  either 
the  one  or  the  other. 

"Our  wealth  increases  $875,000,000  every  year;  while  the 
increase  of  France  is  $375,000,000,  Great  Britain  $325,000,000  and 
Germany  $200,000,000.  The  total  carrying  capacity  of  all  the 
vessels  entered  and  cleared  from  American  ports  during  the  year 
1886-7  in  the  foreign  trade  was  28,000,000  tons:^ 

How  many  of  these  ships  carried  the  flag  of  the 
republic  ?  Comparatively  none.  High  protection  has 
swept  American  vessels  from  the  seas.  In  this  connec- 
tion let  me  quote  again  from  Hon.  David  A.  Wells,  a 


McKINLEY'S  STATISTICAL  ARGUMENT.  33 

Statement  which  no  one  can  successfully  dispute: 
"  During  its  existence  [the  low  tariff  of  1846]  the  Amer- 
ican mercantile  marine  touched  its  highest  point  of 
prosperity,  nearly  equaling  in  point  of  tonnage  that  of 
Great  Britian,  and  being  nearly  as  large  as  the  entire 
tonnage  of  all  the  nations  of  the  world  with  the  excep- 
tion of  Great  Britain." 

The  UnitedStates  has  a  larger  population  than  any  of 
the  other  countries  mentioned.  It  is  of  broader  area.  It 
is  a  new  and  more  fertile  field.  It  is  richer  in  gold,  silver, 
iron,  copper,  coal  and  timber  than  any  other  nation  on 
the  globe.  Why  should  it  not  grow  wealthy  with  mar- 
velous speed  ? 

"This  (our  country's)  advancement  is  the  world's  wonder. 
The  uatious  of  the  earth  can  not  furnish  such  a  splendid  exhibi- 
tion of  progress  in  any  age  or  period.  We  defy  a  revenue  tariff 
policy  to  present  such  an  exhibition  of  material  prosperity  and 
industrial  development.  Art,  science  and  literature  have  held 
their  own  in  this  wonderful  march.  We  are  prosperous  to-day 
beyond  any  other  people.  The  masses  are  better  cared  for,  better 
provided  for,  more  self-resi^ectiug  and  more  independent  than 
ever  before  in  our  history,  which  can  not  be  said  of  the  masses  of 
other  countries." 

This  is  simply  declamation,  not  argument.  It  could 
have  been  delivered  at  any  time  within  the  past  fifty 
years  as  appropriately  and  truthfully  as  now.  Fourth 
of  July  orators  have  addressed  their  hearers  in  substan- 
tially the  same  grandiloquent  language  for  generations. 
They,  however,  defied  the  despots  of  the  earth  instead 
of  a  revenue  tariff.  Centennial  orators  have  traveled 
stiltedly  over  the  same  ground  and  indulged  in  precisely 
the  same  rhetoric;  they,  however,  attributed  our  won- 


34  McKINLEV'S  STATISTICAL  ARGUME.VT. 

derful  success,  not  to  a  protective  tariflf,  but  to  the 
political,  social  and  commercial  freedom  of  the  citizen. 
Reunion  orators  have  dwelt  with  even  greater  particu- 
larity of  detail  upon  the  surpassing  glory  of  our  country 
and  the  marvelous  prosperity  of  our  people,  but  they 
have  ascribed  all  the  credit,  not  to  an  exorbitant  duty  on 
pig  iron,  but  to  the  Un^'on  soldiers  who  fought  the  bat- 
tles of  the  republic  and  won  its  victories. 

"  Oue  of  the  striking  differences  between  a  revenue  tariff  and 
a  protective  tariff  is  tliat  the  former  sends  the  money  of  its  peo- 
ple abroad  for  foreign  supplies  and  seeks  out  a  foreign  market. 
The  latter  keeps  the  money  at  home  among  our  own  people,  cir- 
culating through  the  arteries  of  trade,  and  creates  a  market  at 
home  which  is  always  the  best,  because  the  most  reliable." 

How  can  Major  McKinley  truthfully  affirm  that  a 
revenue  tariff  "  sends  the  money  of  its  people  abroad  for 
foreign  supplies?"  There  are  at  least  three  things 
under  a  low  tariff  always  present  to  induce  the  citizen  to 
buy  at  home  and  to  deter  him  from  making  purchases 
abroad  :  First,  the  tariS  tax;  second,  the  cost  of  trans- 
portation on  land  and  water;  third,  the  middle  man's 
commissions  and  profits.  What  further  protection  can 
the  home  maker  and  seller  reasonably  ask  ?  Shall  we 
give  them  control  of  the  market,  and  thus  enable 
them  by  combinations,  pools  and  trusts  to  extort 
from  the  buyer  and  consumer  any  price  they  please  ? 
Major  McKinley  boasts  of  the  freedom,  culture  and 
practical  business  sense  of  our  people,  and  yet  he  de- 
clines to  give  them  any  liberty  in  commerce;  he  refuses 
to  permit  them  to  exercise  their  own  judgment  in 
making   purchases,  and  assumes  the  right  to  oppress 


McK/NLEV'S  STATISTICAL  ARGUMENT.  35 

them  with  unnecessary  expenses  and  annoying  trade  re- 
strictions. Garfield  stood  squarely  upon  a  low  tariff 
platform  and  gave  utterance  to  the  convictions  of  a 
scholar  and  statesman  when  he  said:  "I  hold  that  a 
properly  adjusted  competition  between  home  and  for- 
eign products  is  the  best  gauge  by  which  to  regulate  in- 
ternational trade."  He  had  his  eye  on  just  such  men 
as  William  D.  Kelly  and  William  McKinley,  Jr.,  when 
he  denounced  that  extreme  school  of  economists  who, 
"  by  making  it  impossible  for  the  foreigner  to  sell  his 
competing  wares  in  our  markets,  would  give  the  people 
no  immediate  check  upon  prices  which  our  manufac- 
turers might  fix  for  their  products.'' 

It  may  be  good  policy  to  keep  our  money  at  home 
and  it  certainly  is  good  sense  to  do  so,  unless  by  send- 
ing it  abroad  we  can  obtain  something  more  valuable 
than  money  in  exchange  for  it.  But  economic  justice 
demands  that  the  citizen  who  earns  his  money  by  the 
sweat  of  his  brow  shall  not  be  robbed  of  it  to  enable  the 
Carnegies  to  build  castles  in  Scotland  and  surround 
themselves  with  all  the  splendors  of  royalty. 

"  Surel^^  a  new  era  of  industrial  development  has  come  to  the 
South.  Nothing  should  be  permitted  to  check  or  retard  it.  To 
her  nature  has  been  most  prodigal  with  her  gifts.  Her  hills  and 
valleys  have  been  made  the  store  houses  of  richest  treasure.  Coal 
and  iron  mines  wait  impatiently  the  touch  of  labor  and  capital, 
and  tempt  both  with  the  promise  of  lavish  profit." 

It  may  be  remarked  in  passing  that  the  orator  at 
last  concedes  that  the  treasures  of  the  hills  and  valleys 
are  the  prodigal  gifts  of  nature,  and  not  the  benefac- 
tions of  a  high  protective  tariff. 


36  McKINLEVS  STATISTICAL  ARGUMENT. 

"  Raw  materials  are  found  at  every  turn  to  invite  tlie  skilled 
artisau  to  transform  them  into  the  finislied  product  for  the  high- 
est uses  of  man.  She  possesses  tlie  fibres  in  rich  abundance  ;  licr 
skilled  labor  should  weave  tlie  fabric." 

Why,  amid  all  this  profusion  of  wealth,  with  iron, 
coal  and  limestone  deposited  in  the  same  hill ;  cotton, 
corn  and  beef  growing  in  the  same  valley,  should  any- 
body want  a  prohibitory  tariff  on  pig  iron,  or  a  high 
protective  duty  on  cotton  cloth? 

England  descends  a  thousand  feet  below  the  surface 
of  the  earth  to  obtain  her  iron  ore  and  coal.  She  comes 
to  America  to  buy  her  cotton,  carries  it  across  the  At- 
lantic to  her  own  looms,  and  when  the  iron  is  in  the  pig 
and  the  cotton  in  the  cloth,  she  must  transport  them 
three  thousand  miles  by  water  and  six  hundred  miles  by 
land  to  bring  them  into  competition  with  these  south- 
ern products.  A  low  tariff  would  afford  all  the  protec- 
tion needed — all  the  protection  honest  men  could  ask 
for;  more  than  this  simply  gives  the  iron  monger  and 
the  cotton  manufacturer  opportunities  for  extortion, 
which  the  great  body  of  our  people  neither  ask  for  nor 
obtain.  There  is  certainly  not,  with  respect  to  these 
products,  "  that  properly  adjusted  competition  between 
home  and  foreign  products  "  which  President  Garfield 
favored,  and  which  every  fair-minded  citizen  should  in- 
sist upon. 


IV. 


FREE  RAW  MATERIAIv  FOR  EXPORT  TRADE,  AND  DRAW- 
BACKS—  M'KINLEY  law  DISCRIMINATES  AGAINST 
THE  HOME  LABORER  AND  IN  FAVOR  OF  HIS  FOR- 
EIGN RIVAL — COMBINATIONS,  POOLS,  AND  TRUSTS 
—  SHERMAN   AND   BUTTERWORTH. 

"  But  if  free,  raw  material  be  necessary  to  secure  an  export 
trade  and  the  foreign  markets,  then  I  answer  that  our  manu- 
facturers to-day  have  substantial  free  trade  in  foreign  raw  mate- 
rials which  they  make  into  the  finished  product  in  the  United 
States,  provided  they  export  it.  Sections  3019,  3020,  3021  and  3022 
of  the  United  States  Statutes  provide  for  the  remission  of  duties 
on  all  foreign  materials  used  in  manufacturing  for  the  export 
trade.  The  law  is  positive  that  all  articles  manufactured  for  ex- 
port from  imported  materials  upon  which  duties  have  been  paid 
shall,  when  exported,  be  entitled  to  a  drawback  of  90  per  cent. 

It  is  99  under  the  McKinley  bill. 

— of  the  duties  paid  on  such  raw  materials.  Some  use  has 
been  made  of  these  laws.  The  remission  of  duties  in  1884  paid 
upon  imported  material  manufactured  for  foreign  markets 
amounted  to  $=2, 2.56, 638.  On  some  articles  the  drawback  is  equal 
to  the  duty  paid,  but  in  no  instance  where  articles  are  imported  to 
be  manufactured  here  and  sent  abroad  is  the  duty  to  exceed  10 
per  cent." 

Major  McKinley  has  already  affirmed  that  the  pro- 
tective system  "  says  to  the  world  of  producers :  '  If 
you  want  to  share  with  the  citizens  of-  the  United 
States  their  home  markets,  you  must  pay  for  the  privi- 
lege of  doing  it;  your  product  shall  not  enter  into  free 
and  unrestricted  competition  with  the  product  of  our 

(37) 


38  DISCR/.'ir/NATES  AGAINST  THE  HOME  LABORER. 

own  people,  but  shall  be  discriminated  against  to  such 
an  extent  as  to  fully  protect  and  defend  our  own.' '"  If 
this  be  true,  and  the  foreign  producer  has  paid  the 
duty  to  the  United  States  Government  for  the  privilege 
of  entering  our  home  market  and  selling  his  goods, 
then  in  that  case  it  must  be  true  that  the  home  manu- 
facturer has  paid  no  duty;  that  he  obtained  his  mate- 
rials, wool  and  iron,  for  instance,  at  what  they  were 
worth  abroad  with  transportation  added.  Why,  there- 
fore, in  the  name  of  common  sense  should  the  govern- 
ment pay  him  ^2,256,638?  If  this  vast  sum  belongs 
to  anybody  except  the  government,  it  belongs,  ac- 
cording to  Major  McKinley's  logic,  not  to  the  manu- 
facturer, but  to  men  who  paid  for  the  privilege  of  sell- 
ing their  goods  in  this  market.  In  fact,  however,  it 
does  not  belong  to  them,  for  they  got  in  return  for  the 
money  the  very  identical  privilege  for  which  they  paid, 
to-wit :  the  privilege  of  entering  our  market  and  selling 
their  wool,  iron,  etc.,  in  competition  with  the  products 
of  our  own  people. 

There  is  evidently,  therefore,  either  a  defect  in  Ma- 
jor McKinley's  argument,  or  the  manufacturers  are  rob- 
bing the  United  States  treasury  by  wholesale. 

There  is  another  feature  of  the  present  tariff  system, 
suggested  in  the  paragraphs  just  quoted,  which  should 
be  seriously  considered.  This  is  the  fact,  that  on  the 
pretext  of  protecting  home  industry  it  accords  to 
foreigners  valuable  favors  which  it  denies  to  our  own 
people. 

Articles  composed  in  part  or  in  whole  of  dutiable 

1  Atlanta,  1888. 


DISCRIMINATES  AGAINST  THE  HOME  LABORER.  39 

material,  when  manufactured  and  sold  here,  are  loaded 
with  the  customs  tax  which  has  been  paid  on  this  im- 
ported material,  the  tax  ranging  anywhere  from  sixty 
to  one  hundred  per  cent.  The  American  citizen  pays 
this  tax  in  full  on  all  of  the  product  consumed  here. 
But  if  goods  of  the  same  brand  and  make  are  sent 
abroad  the  foreigner  obtains  them  after  this  duty,  rang- 
ing from  sixty  to  one  hundred  per  cent,  has  been 
stricken  off,  and  hence  gets  them  at  a  considerably  less 
price  than  that  paid  by  our  own  people  for  substantially 
the  same  things.  In  other  words,  the  $2,256,638  which 
Major  McKinley  says  were  refunded  to  exporters  of  this 
class  of  goods  in  1884  indicate  the  exact  sum  which 
the  home  consumer  would  have  to  pay  for  the  same 
quantity  of  goods,  over  and  above  what  the  foreign 
consumer  did  have  to  pay  for  the  goods  exported.  In 
brief,  the  foreign  consumer  obtained  the  goods  referred 
to  $2,256,638  cheaper  than  it  was  possible  for  the  Amer- 
ican consumer  to  buy  them. 

This  would  seem  to  be  a  decided  discrimination 
against  the  home  laborer  and  in  favor  of  his  foreign 
rival,  and  goes  far  to  support  the  belief  entertained  by 
many  honest  and  thoughtful  men,  that  what  a  high  pro- 
tective tariflf  gives  to  the  workingmen  of  America  with 
one  hand  it  takes  away  from  them  with  the  other. 

"And  yet  we  are  gravely  told  by  the  tariff  reformers  that  we 
cannot  reach  foreign  markets  on  account  of  the  high  tariff  on  the 
raw  material,  when  in  fact,  for  foreign  trade,  foreign  raw  materials 
are  practically  free.  This  principle  was  recognized  as  early  as  the 
administration  of  George  Washington  and  has  been  enlarged  and 
made  applicable  to  all  imported  materials,  the  drawbacks  varying 
from  60  to  100  per  cent." 


40  DISCRIMINATES  AGAINST  THE  HOME  LABORER. 

These  drawbacks  show  exactly  how  much  farther 
the  foreign  laborer's  wage  goes  in  the  purchase  of  the 
comforts  and  conveniences  of  life  than  the  wage  of  the 
home  worker. 

*'  But  if  any  of  our  people  are  sighing  for  a  foreign  market, 
and  value  it  more  highly  than  our  own,  they  can  import  foreign 
raw  material  praetieallj'  free  of  duty,  and  after  advancing  it  into 
the  higher  forms  of  manufacture,  can  go  out  and  possess  the 
world's  markets.  Taxed  raw  materials  do  not  stand  in  their  way, 
and  it  is  hypocrisy  to  claim  otherwise." 

The  workingmen  of  this  country  are  not  sighing 
particularly  to  possess  the  world's  markets.  They 
could  be  humbly  content  with  a  market  at  home  in 
which  they  would  not  be  robbed  in  a  genteel  and  legal 
way  by  a  multitude  of  trusts,  combines  and  pools. 

Combinations  to  limit  production,  destroy  competi- 
tion, control  the  home  market  and  advance  prices,  were 
unknown  to  the  low  tariff  period,  and  are  the  direct 
and  legitimate  outgrowth  of  the  protective  system. 
Mr.  Carl  Schurz  said  in  a  recent  speech, '  "  I  have  be- 
fore me  a  list  of  twenty-seven  industries  carried  on 
under  trusts,  combinations,  agreements  or  understand- 
ings of  various  kinds,  having  the  control  of  production 
and  of  prices  in  view.  Almost  all  these  industries  pro- 
duce, directly  or  indirectly,  things  of  common  use,  the 
prices  of  which  are  of  great  importance  to  people  of  all 
classes,  especially  to  those  of  limited  means." 

Senator  Sherman  said,  ^  "  The  great  danger  of  the 
tarifif  and  of  all  schemes  for  building  up  domestic  in- 
dustries by  law,  is  that  the  beneficiaries  themselves, 

1  Boston,  1890. 

2  Tarifl'  Debates,  United  States  Senate. 


DISCRIMINATES  AGAINST  THE  HOME  LABORER.  41 

capitalists  and  laborers  alike,  will  not  be  content  to 
realize  the  advantages  they  enjoy,  but  will  combine  and 
confederate  in  order  to  cheat  the  people  of  that  which 
they  have  a  right  to  enjoy.  This  protective  policy  must 
not  degenerate  into  monopoly  —  into  trusts  or  combi- 
nations to  raise  prices  against  the  spirit  of  the  common 
law."  ^ 

Senator  Sherman's  note  of  alarm  and  of  warning 
was  sounded  too  late.  The  high  protective  policy  en- 
gendered its  first  brood  of  monopolistic  combinations 
years  ago,  and  has  been  breeding  prolifically  ever  since. 
When  the  McKinley  bill  was  under  discussion  in  the 
House  of  Representatives,  Hon.  Ben.  Butterworth,  a 
stalwart  Republican  and  one  of  the  ablest  debaters 
Ohio  ever  sent  to  Congress,  said  :  "  I  propose  to  show 
that  under  certain  tariff   regulations,  which  have  the 

1  "A  Cut  in  Prices. — The  Carnegie  Steel  Company  Desert 
the  Combine. 

"  Pittsburg,  Nov.  9. — The  announcement  was  made  tonight 
and  later  confirmed  that  the  Carnegie  Steel  company,  limited,  of 
this  city,  had  broken  away  from  the  steel  combine  and  cut  the 
prices  on  steel  rails  |5  per  ton,  from  ^29  to  $24." — Ohio  State  Jour- 
nal, Nov.  10,  1893. 

"  A  Cut  in  Prices. — Steel  Companies  Slash  Rates.— Combina- 
tion Falls  to  Pieces. 

"Pittsburg,  Nov.  10. — Concerning  the  cut  in  steel  rails 
reported  last  night,  the  Pittsburg  Post  will  say  tomorrow  that  it 
is  in  a  position  to  state  that  the  cutting  on  rails  has  been  much 
greater  than  supposed.  Within  a  few  days  the  Maryland  Steel 
company  accepted  an  order  for  15,000  tons  of  rails,  delivered  on 
the  line  of  the  Boston  and  Albany  railroad,  at  $22  per  ton,  and 
within  a  couple  of  days  the  Carnegie  Steel  company  has  sold  rails 
at  the  phenominally  low  price  of  $21.90  at  the  mill.  Tbis  is 
slashing  prices  witn  a  vengeance  and  is  unparalleled  in  this 
branch  of  the  trade.  The  effect  of  it  has  been  the  disruption  of 
the  pool  that  has  been  in  existence  for  the  last  four  years." — Ohio 
State  Journal,  Nov.  11,  1893. 


42  DISCRIMINATES  AGAINST  THE  HOME  LABORER 

approval  of  some  of  my  friends,  and  which  it  is  pro- 
posed in  a  large  degree  to  aggravate,  they  have  in  fact 
take?i  out  of  the  farmers  of  the  country  —  out  of  our 
people — hundreds  of  millions  of  dollars^  for  which  we 
seek  to  atone  by  presenting  them  pictures  of  prosperity. 
For  instance,  we  propose  to  double,  and  more  than 
double,  thetariflfon  tin.  It  is  proposed  to  continue  to 
exact  of  this  people  a  bounty  for  the  producers  of  copper. 
It  is  proposed  to  enable  certain  individuals  in  the 
United  States  to  have  a  corner  on  nickeled  steel.  *  *  * 
First,  let  us  take  the  question  of  copper.  During  ten 
years,  as  I  have  stated,  the  people  of  this  country  have 
contributed  of  their  hard  earned  wages  many  millions  of 
dollars,  for  which  they  have  no  consideration  whatever. 
It  is  a  mere  gratuity  and  extortion.  The  same  may  be 
said  of  one-half  the  money  paid  for  nickel  in  the  United 
States  during  the  same  period.  The  same  may  be  said 
of  the  increased  cost  of  tin  proposed  in  this  bill.  Let 
me  add  also,  the  further  amount  we  have  paid  to  the 
producers  of  steel  rails  during  the  last  two  decades. 
The  amount  is  simply  fabulous.  We  will  pay  this  year 
probably  ten  millions  —  certainly  five  millions  as  a  mere 
gratuity.  *  *  *  j  sound  the  note  of  warning,  and 
whatever  this  House  may  decide  *  *  *  I  assert 
that  there  never  was  a  time  in  the  history  of  the  Repub- 
lican party  when  it  was  in  more  danger  of  defeat  than 
upon  this  one  suggested  idea  that  it  is  permissible  to 
levy  tribute  upon  all  the  people  o{  th'xs  covLXitry  *  *  * 
to  confer  a  benefit  upon  a  few  hundreds^  by  going  beyond 
the  imposition  of  a  protective  tariff  necessary  to  re- 
move inequalities  and  impart  to  competition  the  qual- 
ity of  fairness." 


V. 

EFFECT  OF  TARIFF  LAWS  ON  THE  WAGES  OF  WORKING- 
MEN — THOMAS  G.  shearman's  STATISTICS  ON  THE 
SUBJECT— CARROLL  D.  WRIGHT — WAGES  IN  EUROPE. 

"Upon  what  terras  can  we  adoi^t  a  revenue  tariff  system  in 
this  country?  In  one  way  only;  by  accepting  European  condi- 
tions and  submitting  to  all  the  discomforts  and  disadvantages  ot 
our  commercial  rivals.  The  chief  obstruction  in  the  way  of  a  rev- 
enue tariff,  are  the  wages  paid  American  workingmen,  and  any 
return  to  that  policy  involves  a  reduction  of  the  cost  of  labor. 
We  cannot  afiord  to  have  cheap  labor  in  the  United  States. 
Cheap  labor  means  cheap  men  and  dear  money." 

The  question  of  wages  is  here  introduced.  It  is  as- 
sumed that  a  low  tariff  would,  by  reducing  wages,  in- 
jure the  working  man,  and  that  the  high  protective  sys- 
tem must  be  continued  in  order  to  maintain  wages  at 
the  present  standard.  It  will  be  observed  that  this  is 
simply  assumption;  no  argument  is  presented  to  sus- 
tain it.  ' 

From  the  census  of  1880,  we  ascertain  that  less 
than  one-sixth  of  our  working  population  find  employ- 

1  "  It  is  claimed  that  we  ought  to  protect  our  labor  against 
the  pauper  labor  of  Europe." 

"Does  a  restrictive  tariff  do  this?  Does  it  prevent  the  labor- 
ers of  Europe  from  entering  into  competition  with  ours?  Does  it 
not,  in  fact,  bring  them  to  our  very  doors?  " 

"  Instead  of  protecting  American  labor  against  the  pauper  la- 
bor of  Europe,  we  have  brought  that  labor  here  to  meet  the 
America  citizen  face  to  face,  on  a  perfect  level,  with  equal  civil 
rights,  and  have  given  to  him  the  advantage  of  our  immense 
landed  capital."  Amasa  Walker. 

(43) 


44  EFFECT  OF  TARIFF  LAWS  O.V  WAGES. 

ment  in  mines  and  manufactures.'  Admitting,  there- 
fore, that  the  wages  of  this  one-sixth  are  increased  by 
the  higlier  prices  which  their  product  sells  for  in  the 
home  market  by  favor  of  the  protective  system,  does  it 
not  follow  that  the  unprotected  laborers,  who  constitute 
the  other  five-sixths,  themselves  pay  whatever  differ- 
ence there  is  between  the  wage  of  the  protected  and 
the  unprotected  workingman  ?  In  other  words,  the 
workingman  who  got  higher  wages  for  making  the 
glass  goblet  which  Major  McKinley  recently  (1891)  re- 
ferred to  at  Lakeside,  obtained  the  higher  wages  be- 
cause the  goblet  could  be  sold  to  other  workingmen 
under  a  high  protective  tariff  for  more  money  than  un- 
der a  tariff  for  revenue,  so  that  in  fact,  while  the  wages 
of  the  protected  few  were  raised,  the  wages  of  the  un- 
protected many  were  not  only  not  increased,  but  the 
purchasing  power  of  their  smaller  wage  was  consider- 
ably diminished. 

Major  McKinley  cannot  logically  claim  in  this  con- 
nection that  high  protection  has  not  made  the  goblet 
dearer  than  it  would  have  been  under  a  revenue  tariff 
without  in  effect  admitting  that  a  low  tariff  would  af- 
ford to  the  glass  industry  all  the  protection  it  requires 
to  defy  competition  and  successfully  and  profitably  sup- 
ply the  home  market. 

In  this  discussion   we  should   not  forget  that  but 

^  "It  would  be  for  within  bounds  to  say  that  four-fifths  of  all 
the  present  consumption  of  manufactures  would  be  supplied  by 
our  national  industry,  irrespective  of  protection.  All  tlie  matter, 
then,  comes  to  this  :  Sliail  we  impose  heavy  duties  to  force  labor 
and  capital  into  such  channels  as  shall  provide,  at  great  expense, 
the  remaining  fifth  of  the  manufactures  we  consume?" 

Amasa  Walker. 


EFFECT  OF   TARIFF  LAWS  ON  WAGES.  45 

three  millions  of  our  working  population  ar-  employed 
in  mines  and  manufactures,  and  that  fifteen  millions  re- 
ceive certainly  no  direct  and  probably  no  indirect  ad- 
vantage from  our  tariff  laws.  Indeed,  it  is  extremely 
doubtful  whether  even  the  workers  in  the  protected  in- 
dustries of  the  country  derive  any  especial  and  sub- 
stantial benefit  from  what  Major  McKinley  calls  the 
true  protective  system.  Additional  profit  there  cer- 
tainly is  to  somebody,  but  this  profit  does  not  at  the 
end  of  the  year  find  lodgment  in  the  pocket  of  the 
workingman. 

Thomas  G.  Shearman  affirms  that  protection  does  not 
increase  wages,  and  that  manufacturers  "pay  no  greater 
wages  than  they  are  obliged  to  do  by  general  competi- 
tion among  employers."  This  seems  probable,  for 
manufacturers  are  very  much  like  other  folks,  and  are 
not  at  all  likely  to  pay  a  workingman  three  dollars  a 
day  when  they  can  obtain  his  services  for  two.  But  Mr- 
Shearman  presents  some  proof  on  this  subject,  a  thing 
which  Major  McKinley  carefully  abstains  from  doing- 
He  says:  "  In  July,  1882,  the  tax  on  imported  socks  and 
other  knit  goods  was  raised  from  35  per  cent,  to  80  per 
cent.  Not  only  did  the  manufacturers  of  these  goods 
fail  to  increase  wages,  but  within  four  months  after- 
wards they  held  a  conference  for  the  purpose  of  cuttmg 
down  the  wages  of  their  workmen." 

Again,"  In  1 872  the  protection  on  iron,  wool  and  cotton 

goods  was  reduced  10  per  cent,  and  wages  were  raised."' 

Again,  "  In  1875  the  protection  on  these  goods  was 

raised  11  per  cent,  and  wages  were  reduced  that  same 

year,  and  for  four  years  thereafter." 


4G  EFFECT  OF   TARIFF  LAWS  ON  WAGES. 

Again,  "  Early  in  1880  a  strong  attempt  was  made 
in  Congress,  with  fair  prospects  of  success,  to  reduce 
the  duty  on  steel  rails  from  ;^28  a  ton  to  $10.  While 
this  was  agitated  the  steel  rail  manufacturers  paid  their 
workmen  higher  wages  than  they  had  done  for  five 
years  previously.  They  kept  up  these  wages  until  a 
new  Congress  was  elected  which  was  known  to  contain 
a  majority  of  protectionists,  who  would  not  allow  the 
steel  duty  to  be  materially  reduced.  Just  before  that 
Congress  assembled  the  steel  rail  manufacturers  gave 
notice  to  their  men  of  a  reduction  of  wages.  About 
fifteen  months  afterward  another  attempt  was  made  to 
reduce  the  duty  on  steel  rails,  and  as  soon  as  that  was 
defeated  the  manufacturers  gave  notice  of  an  another 
and  larger  reduction.^'' 

Again,  "  The  highest  tariff  taxes  upon  iron  that  were 
ever  known  in  this  country  were  levied  from  1828  to 
184G.  During  that  period,  as  the  manufacturers  testi- 
fied before  a  ^  *  committee  of  Congress,  they  made 
no  increase  of  wages  whatever.  Between  1840  and  1842 
the  duties  on  iron  were  reduced  with  no  perceptible 
efiect  on  wages.  In  the  middle  of  1842  the  duties  were 
more  than  doubled  and  remained  high  until  December, 
1846;  official  inquiries  being  made  in  the  autumn  of 
1845,  not  one  manufacturer  pretended  that  he  had  in- 
creased wages.  In  December,  1846,  the  duties  were  cut 
down  about  one-third,  and  so  remained  until  July, 
1857."— 

This  is  the  revenue  tariff  period  denounced  by 
Major  McKinley. 

— "  The  manufacturers,''  Mr.  Shearman  continues, 


EFFECT  OF  TARIFF  LAWS  ON  WAGES.  47 

"  during  that  period  very  largely  increased  wages  in  the 
iron  trade,  as  well  as  in  every  other.'' 

Again,  "  There  never  was  before  and  there  never 
has  been  since  so  rapid  an  advance  in  the  wages  of 
manufacturing  workmen  of  all  classes,  estimated  in 
gold  value,  as  between  1846  and  1860,  during  which 
time  the  tariff  taxes  were  lower  than  they  have  ever 
been  at  any  other  time  since  1812," 

Again,  "  The  census  of  1880  shows  conclusively  that 
the  highest  wages  are  paid  by  those  employers  who  are 
not  benefited  by  protectiott^  and  that  the  lowest  wages 
are  paid  by  the  protected  classes y 

A  paragraph  in  a  report  of  Hon.  Carroll  D.  Wright, 
formerly  labor  commissioner  of  Massachusetts,  would 
seem  to  indicate  beyond  a  peradventure  that  high  pro 
tection  tends  directly  to  the  impoverishment  of  working 
people.  He  gives  the  wages  in  1860  and  in  1881,  and 
also  the  cost  of  living  in  those  years,  and  says : 

"  Covering  the  whole  period  of  twenty-otae  years, 
there  was  an  average  increase  in  wages  ot  31.2  per  cent, 
and  in  prices  41.3  per  cent.  That  is,  between  1860  and 
1881  the  workingman  has  suffered  a  reduction  of  Z^;//^;- 
ce7it.  in  the  purchasing  power  of  his  wages ^  and  this  be- 
tween a  dead  level  year  and  one  of  general  prosperity.'' 

Admitting,  however,  that  wages  are  higher  here 
than  elsewhere,  and  that  some  of  our  manufacturers 
should  be  protected  against  cheaper  foreign  labor,  can 
any  intelligent  and  fair-minded  man  doubt  that  alow 
tariff  would  afford  all  the  protection  necessary?  Prof. 
W.  D.  Wilson,  of  Cornell  University,  lut  the  proverbial 
nail  squarely  on  the  head  wheu  he  affirmed  that  "  pro- 


48  EFFECT  OF  TARIFF  LAWS  ON  WAGES. 

tection  for  its  own  sake,  and  with  a  mere  vague  notion 
of  doing  good  somehow,  is  but  an  idle  fancy  of  not  a 
very  clear  brain." 

Wages  have,  within  the  past  fifty  years,  increased  in 
all  civilized  countries.  The  increase  for  Great  Britain 
is  estimated  at  very  nearly  one  hundred  per  cent.  The 
larger  proportion  of  this  increase  "  has  occurred  within 
the  later  years  of  this  period.  *  *  *  ^^  London,  in 
1885,  Sir  Lowthian  Bell  stated  *  *  *  that  all  the 
evidence  from  France,  Germany,  Belgium  and  Austria 
goes  to  prove  that  while  during  the  last  forty  years  the 
cost  of  living  in  all  these  countries  had  been  notably 
augmented  (with  an  accompanying  rise  in  wages),  in 
the  United  Kingdom  under  free  trade  measures,  with  a 
large  average  rise  in  wages,  the  cost  of  living  has  sen- 
sibly diminished."  ^ 

From  all  the  facts  presented,  but  especially  from 
the  fact  that  "  the  average  rate  of  wages,"  to  use  Mr. 
Wells'  language,  "  has,  within  a  comparatively  recent 
period,  greatly  increased  in  all  civilized  countries,"  it 
would  be  manifestly  unfair  and  untrue  to  attribute 
the  rise  in  wages  in  this  country  to  a  high  tariff,  and 
equally  false  to  claim  that  a  high  tariflf  must  be  con- 
tinued in  order  to  maintain  them  at  the  present 
standard.  ' 

In  closing  on  this  point  it  is  pertinent  to  say  that 

^  Wells'  Economic  Chauges. 

2  "  Col.  Carroll  D.  Wright,  the  Republican  Commissioner  of 
the  Bureau  of  Labor  at  Washington,  after  a  careful  investigation 
of  the  subject,  reijorted  that  wages  had  advanced  as  nmch  during 
the  last  fifty  years  in  England  under  free  trade  as  in  this  country 
under  restriction  —  a  fact  which  proves  that  high  tariffs  do  not 
make  high  wages." — Chicago  Herald. 


EFFECT  OF  TARIFF  LAWS  ON  WAGES.  49 

Prof.  A.  L.  Perry  affirms  that  the  United  States  census 
reports  show  that  "  between  1850  and  1860  (the  low 
tarifif  period)  the  wealth  and  wages  of  the  country  in- 
creased in  a  greater  ratio  than  between  1860  and  1880," 
the  high  tariff  period.' 

i  "  I  have  always  been  an  ultra  protectionist.  I  have  made 
speech  after  si^eech  about  the  pauper  labor  iu  Europe.  I  have 
tried  to  bring  tears  to  the  eyes  of  my  auditors  in  describing  the 
pitiful  conditions  aud  the  hard  times  across  the  sea.  The  first 
thing  when  I  got  to  Bremen  I  began  to  look  for  pauper  labor.  I 
hunted  for  it  in  Hamburg,  in  Saxony.  I  scoured  Berlin  for  it,  but 
not  one  pauper  laborer  could  1  find.  There  are  more  loafers  in  an 
American  city  than  there  are  in  all  Germany.  I  affirm  this  as  an 
absolute  fact.  There  are  two  things  they  do  not  have  in  the 
fatherland  — weeds  aud  loafers." — Hon.  Ben.  Butterworth. 

"Although  wages  are  considerably  higher  in  the  United 
States  than  in  England,  much  of  the  advantage  which  labor 
should  derive  from  these  additional  wages  is  lost  in  consequence  of 
almost  every  article  in  general  use  being  made  unnecessarily  '  dear 
by  protective  duties.'  " — Henry  Faucett. 

"  Wages  iu  America  were  higher  than  in  any  country  in  Europe 
when  every  country  in  Europe,  England  included,  was  high  tariff 
up  to  the  eyes,  and  this  country  was  so  much  low  tariff  that  it 
was  pointed  to  as  illustrating  the  blessings  of  free  trade  and  low 
taxes."— JVew  York  limes,  Nov.  12,  1893. 

Protection  and  Wages. —  "Of  all  the  nonsense  talked 
against  the  reduction  of  tariff  taxes,  the  claim  that  they  benefit 
the  workingman  is  most  transparent.  The  effect  of  these  taxes  is 
to  increase  the  price  of  everything  that  the  workingman  sells  his 
labor  for,  since  the  money  he  gets  is  only  the  medium  witli  which 
he  obtains  what  is  the  real  object  of  his'labor.  Granted,  which  is 
only  true  in  a  comparatively  few  cases,  that  such  taxes  increase 
the  profits  of  his  employer.  Do  employers  pay  larger  wages  when 
they  get  larger  profits  ?    I  do  not,  and  even  philanthropists  do  not. 

"Take  Mr.  Andrew  Carnegie,  who  gives  like  a  prince  out  of 
the  millions  the  tariff  has  enabled  him  to  take  from  his  fellow-cit- 
izens. He  gives  like  a  prince  from  his  more  than  princely  income, 
but  he  doesnot  raise  wages  unless  he  has  to." — Hon.  Tom.  L.  John- 
son, a  steel  rail  manufacturer. 


VI. 

THE  CONDITION  OF  A  COUNTRY  CANNOT  BE  INFERRED 
FROM  THE  AMOUNT  OF  ITS  IMPORTATIONS — NON- 
DUTIABLE  IMPORTS  OF  1890 — OUR  HIGH  TARIFFS 
HAVE  DEVELOPED  THE  WHEAT  GROWING  INDUSTRY 
OF  OTHER  COUNTRIES. 

"The  increase  of  our  importations  in  agricultural  products 
has  risen  from  $40,000,000  in  1850,  to  $256,000,000  in  1889.  We  im- 
ported in  the  last  ten  years  more  than  $60,000,000  worth  of  horses, 
cattle  and  sheep.  "^ 

This  paragraph  was  evidently  intended  to  alarm  the 
farmers,  but  when  understood  it  will  not  have  the  effect 
desired. 

The  importations  of  1850,  amounting  in  value  to 
$40,000,000,  were  made  under  the  revenue  tariff  of  1846 
— a  tariff  which  has  been  time  and  again  denounced  by 
Governor  McKinley  as  an  invitation  and  an  encourage- 
ment to  other  countries  to  send  their  products  hither  to 
be  sold  in  competition  with  those  of  the  American  pro- 
ducer; and  yet  he  tells  us  that  in  1889,  under  the  high 
tariff  of  1883,  we  imported  $256,000,000  of  foreign  agri- 
cultural products,  $216,000,000  more  than  had  been  im- 
ported under  the  low  tariff  of  1846.  This  statement,  if 
accepted  as  it  is  presented  by  Governor  McKinley, 
would  not  indicate  that  farmers  were  being  at  all  bene- 
fited by  the  high  protective  system  ;  for  if  a  low  tariff 

^  House  of  Representatives. 

(50) 


HIGH  TARIFF  DEVELOPMENTS.  51 

leads  to  the  importation  of  but  $40,000,000  of  agricultu- 
ral products,  and  the  high  tariff  brings  in  ;^256, 000,000, 
the  former,  according  to  the  Governor's  economic  doc- 
trine, must  be  a  great  deal  better  for  farmers  than  the 
latter.  The  wonder,  therefore,  is  that  he  did  not 
qualify  his  statement,  and,  in  so  far  as  he  could  do  so, 
make  it  conform  to  his  theories.  The  truth  is,  how- 
ever, that  the  Governer  is  "  figure"  blind,  and  when  he 
takes  to  handling  statistics  is  far  more  likely  to  hurt 
himself  than  to  harm  his  opponents. 

The  population  of  the  United  States  in  1850  was 
23,000,000.  In  1889  it  had  increased  to  over  64,000,- 
000,  and  a  larger  amount  of  products  was  required  to 
supply  the  larger  population  than  was  needed  to  sup- 
ply the  smaller.  Again,  during  the  thirty-nine  years 
intervening  between  1850  and  1889,  our  people  had 
greatly  increased  in  wealth,  and  this  added  wealth  had 
not  only  multiplied  their  wants,  but  enabled  them,  with- 
out any  perceptible  diminution  of  their  means,  to  fully 
gratify  them.  Again,  the  agricultural  products  im- 
ported in  1850  and  in  1889  were  in  the  main  not  such 
products  as  come  in  competition  with  the  products  of 
the  American  farmer,  nor  were  they  such  products  as  the 
McKinley  law  now  makes  dutiable.     They  consisted  of 

1.  Coffee  and  cocoa,    (of   which  we    im- 

ported in  1890) $80,580,213 

2.  Sugar  (same year) 89,734,684 

3.  Tropical  fruits  (same  year) 6,867,670 

4.  Live  animals  for  breeding 3,496,655 

5.  India  Rubber  and  gutta  percha 14,854,512 

6.  Spices,  ungrouud 2,973,994 

Rice,   molasses,  sugar,  from  Hawaiian  Is- 
lands under  the  reciprocity  treaty 12,058,557 

Tea 12,317,493 


52  HIGH  TARIFF  DEl'ELOPMENTS. 

The  products  named  constituted  in  1890,  ;g222,883,- 
778  of  the  imported  agricultural  products  referred  to  by 
Governor  McKinley. 

Under  the  McKinley  law  they  are  now  all  admitted 
free  of  duty,  and  it  was  at  least  unfair  for  the  Governor 
to  allow  his  hearers  and  readers  to  infer  that  they  came 
in  competition  with  the  products  of  the  Northern 
farmer. 

"  We  imported  within  the  last  ten  years  more  than  S60,000,000 
worth  of  horses,  cattle  and  sheep." 

Nine-tenths  of  these  at  least  were  for  breeding  pur- 
poses or  the  improvement  of  the  farmers'  live  stock. 
This  subject,  however,  will  be  discussed  more  fully 
hereafter. 

"  The  farmers  of  the  United  States  have,  therefore,  come  to 
appreciate  that,  with  the  wonderful  wheat  development  in  India 
and  Russia,  the  time  is  already  here  when  the  American  farmer 
must  sell  his  product  in  the  markets  of  the  world  in  competition 
with  wheat  produced  by  tlie  lowest  priced  labor  of  other  countries, 
and  that  his  care  and  concern  must  in  the  future  be  to  preserve 
his  home  market."  ^ 

The  cost  of  farm  labor  is  higher  in  the  United 
States  than  in  any  other  country  of  the  world,  and  has 
been  so  under  low  tariffs  and  high  tariffs  for  a  hundred 
years  and  more;  but  none  of  the  older  countries  can 
compete  with  us  in  the  production  of  wheat  for  the 
simple  reason  that  they  lack  not  only  in  acreage  suita- 
ble for  wheat,  but  in  that  freshness  and  fertility  of  soil 
which,  with  intelligent  labor  in  production,  enable  the 
American  farmer,  despite  the  higher  price  of  labor,  to 

^  House  of  Representatives,  1890. 


HIGH  TARIFF  DEVELOPMENTS.  53 

excel  all  others  in  the  growing  of  this  cereal/  It  was 
not,  however,  to  call  attention  to  this  point  in  the  dis- 
cussion that  Governor  McKinley's  words  were  quoted, 
but  for  the  purpose  of  suggesting  to  the  reader  the 
cause  of  the  wonderful  impetus  to  the  wheat  industry 
of  Russia  and  India  to  which  he  alludes. 

The  United  States,  although  the  greatest  wheat  pro- 
ducing country  on  the  globe,  has  now  for  thirty-two 
years  by  exorbitantly  high  tariflfs,  signified  its  unwill- 
ingness to  exchange  products  with  other  countries  on 
fair  terms.  We  have  been  eager  enough  to  sell,  but 
loth  to  buy,  and  other  countries  could  not  buy  of  us  un- 
less they  sold  to  us,  and  hence  from  the  day  when  we 
put  high  duties  upon  foreign  products  to  deter  their 
importation  and  diminish  their  sale  in  this  country, 
they  —  and  especially  England  —  began  to  look  else- 
where for  breadstuffs,  and  the  wheat  industry  of  other 
countries  received  that  stimulus  and  encouragement 
which  have  finally  developed  it  into  huge  proportions. 
Our  narrowness  and  niggardliness  have  thus  been  in- 
strumental in  bringing  competitors  into  prominence 
who  under  a  wise  and  liberal  policy  would  have  re- 
mained unknown,  or  at  least  undealt  with.  It  is  one  in- 
stance of  national  importance  in  which  short-sighted 
statesmen  have  disabled,  if  not  wholly,  killed  the  goose 
which  laid  the  golden  ^'g^^  and  a  forcible  verification 

1  "The  Illiuois  or  Australian  fiirraer  has  to  pay  his  laborers 
at  least  two  or  three  times  as  much  as  is  paid  by  the  Dorsetshire 
or  Wiltshire  farmer,  and  yet  wheat  cau  be  produced  mucli  more 
cheaply  in  Australia  or  America  than  in  England.  It  is  there- 
fore ol)vi()Us  that  other  circumstances,  besides  the  amount  of 
wages  which  may  be  paid,  determine  the  cost  at  which  any  par- 
ticular article  cau  be  produced." — Henry  Faucett. 


54  HIGH  TARIFF  DEVELOPMENTS. 

also  of  the  truth  of  Pitt's  apothegm,  "  Small  ideas  and 
great  empires  go  ill  together."  The  danger  which  con- 
fronts us  now  does  not  lie  in  the  probability  suggested 
by  Governor  McKinley,  that  wheat  may  be  brought 
into  this  country  from  Russia  and  India,  but  in  the  fear 
that  wisdom  may  not  be  able  to  recall  the  profitable 
trade  which  folly  has  driven  away/ 

^  "  An  imiwrt  duty  imposed  upou  wine  iu  Frauee,  or  ou 
wheat  iu  America,  would  therefore  be  of  no  advantage  to  the 
Freuch  wiue  grower  or  tlie  American  farmer.  They  are  conse- 
queutly  precluded  from  receiviug  any  compensation  for  the  higher 
price  whicli  they  are  compelled  to  pay  for  the  various  articles  that 
are  made  dearer  through  the  operation  of  protective  duties." — 
Henry  Faucett. 

Higli  tariff  advocates  understand  very  clearly  that  the  farmer 
is  not  benefited  by  the  high  protective  system.  In  arguing 
against  a  low  tariff  the  Columbus  Evening  Dispatch,  oi  January 
24,  1894,  made  the  following  honest  confession  in  its  editorial 
column : 

"  But  when  it  comes  to  furnishing  things  for  his  table,  the 
condition  of  the  wage-earner  is  still  worse.  He  will  have  less 
money  to  buy  with,  and  the  chances  are  that  the  price  of  farm 
commodities  will  be  increased.  Certainly  it  will  not  be  reduced  by 
reason  of  a  wider  market.  He  will  liave  to  pay  the  same,  if  not 
more,  for  his  potatoes,  and  the  same,  if  not  more,  for  his  eggs  and 
meats,  his  flour  and  his  cabbage." 


VII. 

DOES  UNFAVORABLE  CRITICISM  OF  THE  M'KINLEY  LAW 
IN  OTHER  COUNTRIES  PROVE  THAT  IT  IS  A  GOOD 
LAW  FOR  THIS  COUNTRY?  —  MEMORIAL  OF  THE 
COLONIAL  PARLIAMENT  OF  BERMUDA. 

"  The  press  of  other  countries  has  denounced  the  bill  (McKin- 
ley  bill)  with  unmeasured  severity  ;  the  legislative  assemblies  of 
more  than  one  distant  country  have  given  it  attention  in  no 
friendly  spirit ;  it  has  received  the  censure  of  foreign  powers  and 
diplomats  for  all  which  there  is  a  manifest  reason  ;  it  may  pinch 
them,  but  no  American  citizen  surely  can  object  to  it  on  that  ac- 
count." 

When  the  people  of  other  countries  speak  unfavora- 
bly of  the  McKinley  law  its  putative  father  accepts  it 
as  proof  conclusive  that  the  child  is  perfect  and  that 
this  unfriendly  comment  abroad  should  at  once  silence 
adverse  criticism  at  home.  But  let  us  consider  this 
phase  of  the  question  briefly,  and  ascertain  whether 
there  is  anything  in  it  of  a  comforting  nature  to  the 
people  of  the  United  States. 

Suppose  the  people  of  the  coal  regions  of  the  Hock- 
ing Valley  should  say  to  the  people  of  Columbus,  "  We 
will  sell  you  coal  for  cash,  but  we  will  not  buy  goods  of 
you.''  What  would  the  people  of  Columbus  naturally 
say  and  do  in  such  a  case  ?  They  would  regret  the 
action  of  the  Hocking  Valley  people,  and  probably  de- 
nounce it  as  unwise,  and  then  they  would  look  else- 
where for  their  coal,  and  so  one  avenue  of  profitable 

(55) 


56  UNFRIENDLY  COM.MEXT  ABROAD. 

commerce  would  be  closed  to  both  parties.  Men  buy 
where  they  sell  and  sell  where  they  buy,  and  find  mu- 
tual profit  and  advantag^e  in  the  exchange  of  products. 
Voluntary  trade  conducted  on  fair  terms  and  for  mutual 
advantage  between  friendly  nations  will  be  stable  and 
uniform,  and  hence  may  be  made  the  basis  for  timely 
preparation,  while  compulsory  trade  must  necessarily 
be  so  irregular  and  uncertain  that  no  forecast  can  make 
adequate  provision  for  it. 

Unfriendly  comment  on  the  McKinley  law  by  other 
nations  simply  means  that  they  will  buy  our  food  pro- 
ducts when  there  is  a  short  crop  in  other  food  produc- 
ing countries,  and  at  no  other  periods.'  If  there  is  any- 
thing in  this  calculated  to  encourage  the  American 
farmer  I  am  unable  to  detect  it. 

Governor  McKinley,  in  a  speech  at  Beatrice,  Ne- 
braska, 1892,  quoted  the  text  of  a  petition  of  the  colon- 
ial parliament  of  the  Bermudas,  islands  that  supply  us 
to  some  extent  with  fresh  vegetables  before  our  own  are 
ready  for  the  market,  in  which  the  petitioners  complain 
of  the  McKinley  law,  and  affirm  that  "  the  market 
value  of  their  products  in  the  United  States  does  not 
allow  of  any  advance  in  price  commensurate  with  so 
heavy  a  tariflf."  After  reading  this  the  Governor,  with 
an  air  of  triumph,  exclaimed,  "  that  being  so  who  pays 
the  tax?''  and  then  concludes,  of  course,  that  the  for- 
eigner pays  it,  and  that  Bermuda  products  will  continue 
as  plentiful  and  sell  as  cheaply  in  this  country  under  a 

^  "  When  our  neighbors  prohibit  some  manufacture  of  ours, 
we  generally  prohibit,  not  only  the  same,  for  that  alone  would 
seldom  affect  them  considerably,  but  some  other  manufacture  of 
theirs." — Adam  Smith. 


UNFRIENDLY  COMMENT  ABROAD.  67 

high  tariff  as  under  a  low  one.  If  the  Governor  had 
read  the  memorial  thoughtfully,  however,  he  would 
have  discovered  that  the  memorialists  did  not  in  their 
displeasure  even  claim  that  under  the  McKinley  law 
they  paid  all  the  additional  tax  which  that  law  had  im- 
posed on  their  products,  but  that  the  American  people 
could  not  or  would  not  pay  them  an  advance  in  price 
*•''  commensurate  with  so  heavy  a  tariff,''  and  hence,  by 
fair  inference,  that  the  American  market  was,  or  would 
be,  practically  closed  to  them,  unless  some  modification 
of  the  law  could  be  obtained. 

It  may  be,  as  I  have  stated  elsewhere,  that  in  excep- 
tional cases  the  farmers  of  the  Canadian  and  Mexican 
border,  and  those  also  of  near-by  islands  like  Bermuda, 
bring  products  of  their  own  raising  to  this  country,  and 
especially  such  products  as  deteriorate  rapidly,  and 
hence  must  find  a  quick  market;  but  whatever  tax  or 
duty  even  these  small  dealers  have  to  pay  in  order  to 
reach  the  United  States  consumer,  is,  as  a  rule,  collect- 
ed back  from  him.  Whenever  such  a  condition  of  the 
market  exists  as  will  not  allow  them  to  collect  this  cus- 
toms tax  from  the  consumer,  and  thus  leave  enough  to 
cover  cost  of  production,  and  a  living  profit,  the  tariff 
becomes  prohibitory  as  to  the  things  they  have  to  sell, 
and  they  cease  to  visit  us,  and  our  opportunity  to  supply 
them  with  our  own  products  has  ended.  Intelligent 
business  men  do  not  congratulate  themselves  on  the 
loss  of  a  customer,  and  I  am  therefore  surprised  to  find 
that  a  statesman  should  be  disposed  to  take  credit  to 
himself  for  driving  profitable  trade  away.  The  islands 
within  easy  reach  of  the  American  continent  should  be 


58  UNFRIENDLY  COMMENT  ABROAD. 

generous  consumers  of  American  products,  and  they 
would  be  if  treated  by  us  with  ordinary  fairness  and  lib- 
erality. When  Governor  McKinley  claims,  as  he  does 
substantially,  that  the  people  of  the  United  States  are 
likely  to  get  the  worst  end  of  a  bargain  in  dealing  with 
them,  and  hence  need  the  interposition  of  the  law,  he 
underrates  the  intelligence  of  his  countrymen  and 
greatly  overestimates  his  own.  Suppose  the  council 
of  Columbus  had  the  power  to  impose  a  duty  of  twenty- 
five  cents  a  bushel  on  potatoes,  wheat,  etc.,  offered  for 
sale  in  its  markets  by  parties  resident  outside  the  cor- 
porate limits  of  the  city,  and  were  to  exercise  that 
power,  who  would  pay  the  tax?  Either  the  people  of 
Columbus  would  pay  it,  or  the  products  of  the  adjacent 
farms  would  go  to  other  towns.  Under  such  a  law  grass 
would  grow  on  High  street,  and  Broad  street  would  be- 
come an  avenue  of  deserted  mansions. 


VIII. 


OUR  TRADE  WITH  CANADA  —  IS  THE  LUMBERMAN 
AN  AGRICULTURIST  —  LUMBER  SHOULD  GO  ON  THE 
FREE  LIST  —  SHOULD  CANADIAN  PRODUCTS  BE  EX- 
CLUDED? BUTTERWORTH'S  answer  —  MILLS  ON 
INCREASING  THE  DUTIES  ON  AGRICULTURAL  PRO- 
DUCTS. 

"  If  that  be  true  (Prof,  Goldwiu  Smith's  statement  with 
respect  to  Canadian  exports  to  the  United  States)  then  the  annual 
exports  of  about  125,000,000  in  agricultural  products  will  be  sup- 
plied to  the  people  of  the  United  States  by  the  American  farmer 
rather  than  by  the  Canadian  farmer ;  and  who  will  say  that  $25,- 
000,000  of  additional  demand  for  agricultural  products  will  not 
inure  to  the  benefit  of  the  American  farmer? "^ 

The  Governor  fails  to  recognize  the  fact  that  the 
United  States  farmer  and  the  Canadian  farmer  are  both 
American  farmers ;  when  speaking  of  the  diverse  inter- 
ests of  the  two  in  the  same  paragraph,  therefore,  it 
would  be  well  to  say  less  of  the  American  farmer  and 
more  of  the  United  States  farmer. 

"If  that  be  true,"  etc.  In  the  first  place,  Prof. 
Goldwin  Smith  did  not  say  that  Canada  exported  ;^25,- 
000,000  of  agricultural  products  annually  to  the  United 
States.  In  the  second  place,  Governor  McKinley  in  a 
few  paragraphs  preceding  the  one  quoted,  itemizes  our 
agricultural  imports  from  Canada,  and  makes  them 
amount  to  but  little  over  thirteen  and  one-half  millions. 

1  House  Representatives,  1890. 

(59) 


60  OUR   TRADE   WITH  CANADA. 

And  ill  this  calculation  he  includes  the  item  of  Cana- 
dian barley,  $6,454,603,  an  article  which  is  said  to  be  in- 
dispensable to  brewers  of  our  Eastern  States  in  the 
manufacture  of  the  better  qualities  of  beer  ;  so  that  if 
Governor  McKinley's  itemized  statement  with  respect 
to  the  value  of  our  agricultural  imports  from  Canada  is 
correct,  his  general  statement  as  to  the  amount  must  be 
an  error. 

It  should  be  said  however,  that  in  his  desire  to  swell 
the  agricultural  imports  from  Canada  he  included  among 
them  the  item  of  "planks  and  boards  ;^7,187,101," 
which  I  have  taken  the  liberty  to  exclude.  I  apprehend 
the  sensible  reader  is  hardly  ready  to  admit  that  planks, 
boards,  sawlogs,  bowlders,  bear,  deer  and  wild  fowl  are 
products  of  the  farm.  I  am  told  that  General  Alger 
owns  many  thousand  acres  of  the  sandy  pine  lands  of 
Northern  Michigan,  and  that  the  duty  imposed  by  our 
tariff  laws  on  Canada  lumber  has  made  him  a  million- 
aire, but  I  never  heard  him  referred  to  as  a  practical 
farmer  or  agriculturist,  and  I  can  conceive  of  no  valid 
reason  why  the  home-builders  of  the  United  States,  and 
especially  those  of  the  prairie  States,  should  be  extorted 
from  in  order  to  render  lands  which  cost  him  $\.1h  per 
acre  worth  $\1h. 

If  there  is  one  single  article  brought  into  the  United 
States  which  above  all  others  is  entitled  to  a  place  on 
the  free  list  it  is  the  article  of  lumber 

1.  Our  people  should  have  cheap  lumber,  and  the 
fact  that  under  a  high  tariff  it  is  imported,  proves  be- 
yond a  peradventure  that  we  pay  dearly  for  it. 

2.  We  should  be  in  no  haste  to  consume  the  forests 


OUR  TRADE  WITH  CANADA.  61 

of  the  United  States  —  the  growth  of  centuries,  for  the 
present  benefit  of  a  few  Algers  ;  on  the  contrary,  in  so 
far  as  possible,  they  should  be  spared  and  reserved  for 
the  use  and  comfort  of  our  descendants.  In  brief, 
there  should  be  no  haste  and  no  waste  with  respect  to 
them,  and  they  should  receive  the  same  vigilant  care 
and  protection  from  our  legislative  bodies  manifested 
by  the  older  countries  of  the  world  in  the  preservation 
of  their  timber  lands.  The  man  who  encourages  the 
destruction  of  a  tree  on  any  slight  pretext  is  a  public 
enemy.  ' 

"From  1854  to  1866  —  twelve  years  of  reciprocity  with  Canada 
—  we  bought  of  theiu  twice  as  much  as  they  bought  of  us.  Wher- 
ever we  have  tried  recijirocity  or  low  duties,  we  have  always  been 
the  loser.  "2 

Governor  McKinley's  argument  in  favor  of  exclud- 
ing Canadian  products  by  a  higher  duty,  and  his  state- 
ments as  to  the  extent  and  value  of  our  trade  with  Can- 
ada, were  answered  by  Hon.  Benjamin  Butterworth,  a 
Republican  member  of  Congress  from  Ohio,  on  the 
floor  of  the  House  of  Representatives,  as  follows : 

"During  1888  we  bought  from  the  Canadians  agricul- 
tural products  to  the  amount  of  over  $17,000,000.  What 
did  we  sell  them  ?  About  $21,000,000,  and  the  larger  part 
of  it  corn  and  the  products  that  we  do  not  btiy  from  them. 
To  please  the  farmer  of  this  country  we  have  shut  him 
out  of  the  market  where  he  sold  his  products  to  the 

'  "The  practically  prohibitive  duty  on  lumber  confines  us 
now  to  our  own  forests  as  the  only  source  of  supply  for  building 
materials.  A  removal  of  the  duty  would  check  the  destruction 
of  American  (United  States)  forests  to  an  extent  which  would 
most  likely,  under  intelligent  forestry  laws,  go  far  to  establish  a 
balance  between  the  natural  growth  and  cutting  down  of  trees." 
—New  York  Times,  Deceynb'v  30,  1893. 

2  House  of  Representatives,  1890. 


62  OUR  TRADE  WITH  CANADA. 

amount  of  ;^21, 000,000,  and  kept  out,  as  a  partial  com- 
petitor, nearly  $17,000,000  that  we  bought  from  the 
Canadian  side.  We  have  shut  out  eggs,  and  that  is 
paraded  as  an  important  matter.  I  made  a  little  calcu- 
lation as  to  how  that  would  affect  our  people.  We  im- 
ported 21,000,000  eggs;  and  by  careful  estimate  that 
amounts  to  just  one  omelet  a  year  to  each  of  our  peo- 
ple— one  omelet  a  year !  That  is  all.  [Laughter.] 
This  committee  knows  very  well  that  my  fellow-citi- 
zens do  not,  during  one-half  of  the  year,  taste  eggs  at 
all.  Our  friends  of  the  committee  have  not  inserted  in 
the  bill  any  provision  which  would  have  enjoined  upon 
the  hens  that  they  should  lay  regularly  during  cold 
weather  as  well  as  warm."     [Laughter.] 

A  Member — "  Give  them  a  bounty." 

Mr.  Butterworth — "  Well,  I  might  have  oflfered  them  a 
bounty.  But  I  do  not  care  to  go  into  that.  My  hon- 
ored friend  stated,  with  the  figures  at  his  command, 
that  in  the  trade  between  the  United  States  and  Can- 
ada, under  the  reciprocity  treaty  of  1854-65,  which  has 
been  so  much  denounced  here  by  many,  the  balance  of 
trade  was  in  favor  of  Canada.  My  friend  is  in  error. 
He  took  into  account  Quebec  and  Ontario,  while  our 
trade  was  with  all  the  Canadian  Provinces,  and  theirs 
with  us.  Yet,  during  those  ten  years  of  reciprocal 
trade,  so  much  deprecated  and  unfair  as  it  was  —  I 
agree  with  my  colleague  in  many  respects  —  we  had 
the  advantage  of  the  balance  sheet  of  over  $60,000,000, 
and  in  the  last  forty  years  in  the  trade  between  the  Cana- 
dian Provinces  and  ourselves  the  balance  in  our  favor  is 
over  ^250,000,000. 

"Strange,  is  it  not?  Against  our  own  countrymen 
here  on  the  north,  in  whose  veins  courses  the  same 
blood  that  courses  in  our  own  —  united  to  us  by  a 
destiny  which  is  above  the  control  of  kings  or  con- 
gresses—  we  shut  the  door,  we  refuse  even  to  accept 


OUR  TRADE  WITH  CANADA. 


63 


their  lumber,  but  send  our  children  shelterless  to  bed 
rather  than  have  a  fair  exchange  with  them. 

' '  But  that  is  not  all.  Behold,  we  have  just  expended 
hundreds  of  thousands  of  dollars  to  establish  unre- 
stricted reciprocal  trade  with  fifty-odd  millions  of  peo 
pie  south  of  us,  of  the  Latin  race.  How  stands  the  bal- 
ance of  trade  with  them  during  the  last  forty  years? 
;^2, 100,000,000  against  us.  The  five  millions  of  our 
kinsmen  north  of  us  have  bought  of  us  ;^250,000,000 
worth  during  that  time  in  excess  of  what  we  purchased 
from  them. 

"What  I  insist  upon  is  that  enlargement  of  opportu- 
nity is  what  is  desired,  and  as  you  multiply  facilities 

you  enlarge  opportunity. 

i(.  if.  ^  -^  -^  -^  -^ 

"  Ulysses  S.  Grant  is  not  thought  to  have  been  un- 
wise in  his  day  and  generation  —  a  patriot,  a  soldier 
and  a  statesman  alike,  he  negotiated,  assisted  by  his 
Secretary  of  State,  Hamilton  Fish,  a  treaty  designed  to 
open  the  avenues  of  trade  between  the  northern  part  of 
our  continent  and  the  southern,  not  only  providing  for 
a  free  exchange  of  manufactured  and  natural  products, 
but  opening  up  the  canals  and  railroads  in  order  that 
the  healthful  tide  of  our  commerce  might  sweep  North 
and  South,  as  it  does  East  and  West. 

"  What  prevented  it  ?  The  avarice  in  certain  local- 
ities. The  opposition  was  dictated  from  the  potato 
patch,  from  the  cabbage  patch,  from  the  hop  patch. 
[Laughter  and  applause.]  And  before  the  bill  is  over 
you  will  see  my  honored  friend  in  charge  of  the  hop 
brigade,  associated  with  the  Cabbage  Cavalry,  endeav- 
oring to  persuade  the  farmer  that  his  highest  good  is  in 
confining  ourselves  to  a  market  where  we  do  not  sell 
now  more  than  three-fourths  of  what  we  produce. 
I  Laughter  and  applause.]" 

Hon.  Roger  Q.  Mills  in  speaking  generally  of  the 


64  OUR  TRADE  WITH  CANADA. 

McKinley  bill,  and  particularly  of  the  proposition  to  in- 
crease duties  on  agricultural  products,  said  : 

"  The  committee  are  greatly  alarmed  about  our 
wheat-growers.  That  great  industry  is  imperiled  by  'a 
most  damaging  competition.'  The  American  market 
must  be  kept  for  our  own  farmers  and  it  must  be  held  at 
all  hazards  ;  and  like  heroes  advancing  to  the  attack,  they 
have  scaled  the  walls,  entered  the  city  and  spiked  the 
enemy's  guns.  They  have  increased  the  duty  on  wheat, 
and  that  great  product  is  safe.  How  many  bushels  of 
wheat  are  imported  into  this  country?  We  exported 
last  year  90,000,000  bushels  in  wheat  and  flour.  In  1880 
and  1881  we  exported  150,000,000  bushels;  but  since 
then  our  importations  have  been  falling  ofif  and  that  has 
caused  a  reduction  in  our  exportations ;  and  last  year 
we  exported  only  90,000,000  bushels  and  imported  the 
inconsiderable  amount  of  1,946  bushels  of  wheat. 
[Laughter  and  applause.]  And  that  duty  has  been  put 
on  to  protect  American  farmers  against  the  damaging 
foreign  competition  from  India  and  Russia. 

"What  did  that  1,946  bushels  of  wheat  cost?  Our 
wheat  was  at  an  average  export  price  of  89  cents  per 
bushel,  and  the  average  price  of  the  1,946  bushels  which 
we  imported  was  ^2.05.  Seven  hundred  bushels  cost  in 
Germany  $3.20  a  bushel.  What  do  you  suppose  that 
wheat  was  imported  for?  Do  not  all  speak  at  once, 
please.  [Applause  and  laughter.]  It  was  seed  wheat, 
imported  by  the  wheat-grower  of  the  West  to  improve 
his  seed. 

"We  exported  69,000,000  bushels  of  corn  last  year 
and  we  imported  into  this  country  2,388  bushels,  an 
amount,  we  are  told,  that  imperils  the  market  of  those 
who  raise  2,000,000,000  bushels.  [Laughter.]  Why,  it 
could  all  be  raised  in  Texas  by  one  farmer  on  50  acres 
of  ground.  That  corn  came  from  Mexico  into  New 
Mexico,  Arizona  and  Texas,  along  the  border,  and  if 


OUR  TRADE   WITH  CANADA.  65 

you  cut  it  out  you  cannot  supply  a  single  bushel  of  it 
from  any  of  the  corn-producing  parts  of  the  country, 
because  the  cost  of  transportation  would  be  so  great 
that  they  cannot  import  it ;  and  if  they  cannot  get  this 
I  suppose  they  can  eat  grass  and  go  naked.  [Laughter.] 

"  Why,  sir,  we  cannot  supply  that  corn  from  Texas, 
because  the  transportation  from  the  settled  part  of  the 
State  to  the  boundaries  on  the  Rio  Grande  would  cost 
too  much,  and  this  market  is  supplied  by  the  little  con- 
tiguous farms  lying  along  the  Rio  Grande  and  along  the 
border  of  Mexico,  whence  it  is  brought  into  our  country. 

"  How  much  rye  did  we  import  last  year?  Sixteen 
bushels !  [Laughter.]  It  could  all  have  been  raised  on 
a  turnip  patch.  [Renewed  laughter.]  What  did  it  cost? 
It  cost  in  Germany,  whence  it  came,  ;^1.50  a  bushel, 
while  the  rye  that  we  exported  from  this  country  cost 
57  cents  a  bushel,  and  we  exported  287,252  bushels." 


IX. 

THE  CANADIAN  FARMER  AND  HIS  WHEAT  —  LIVERPOOL 
MAKES  THE  PRICE  FOR  AMERICAN  WHEAT — THE 
IMPORTATION  OF  CANADIAN  WHEAT  NO  INJURY  TO 
THE    UNITED   STATES   FARMER. 

"  If  you  waut  to  know  who  pays  the  tax  (on  imported  goods) 
go  ask  the  Canadian  farmer.  He  brings  his  wheat  to  Erie  county, 
New  York  —  to  the  city  of  Buffalo,  and  the  Erie  county  tarmer 
brings  his.  They  meet  at  the  same  market  place.  The  Erie 
county  farmer  takes  ninety  cents  home  M'ith  him.  The  Canadian 
farmer  takes  ninety  cents  less  twenty-five  cents,  the  American 
tariff."  1 

Here  Governor  McKinley  again  makes  the  unqual- 
ified affirmation  that  the  foreigner  pays  the  tax  or  duty 
on  imported  goods,  and  that  this  duty,  therefore,  does 
not  increase  the  price  of  the  imported  article  to  the 
American  consumer.  But  the  case  he  alludes  to  is  ex- 
ceptional, if  not  wholly  fictitious.  Canadian  farmers, 
do  not  as  a  rule,  seek  a  market  for  wheat  in  the  United 
States.  They  can  obtain  just  as  much  for  it  in  Toronto, 
Montreal,  Quebec  and  other  Canadian  cities  as  they 
can  get  for  it  in  Buflfalo.  They  would  manifest  a  lack  of 
ordinary  business  intelligence,  therefore,  if  they  were  to 
pay  twenty-five  cents  for  permission  to  sell  a  bushel  of 
wheat  in  Buffalo  for  ninety  cents  when  they  could  sell 
it  at  home  for  ninety  cents,  without  the  payment  of  any 
duty  whatever. 

^  Governor  McKinley  at  Ada,  1891. 
(66) 


THE  CAXADIAN  FARMER  AND  HIS  WHEA  T.  67 

It  is  not  at  all  improbable,  however,  that  compara- 
tively inconsiderable  quantities  of  seed  wheat  are  im- 
ported, and  that  Canadian  farmers  living  near  the  St. 
Clair  River,  the  Detroit,  the  Nia^^ara  and  the  St.  Law- 
rence may  be  able  to  find  a  city  in  the  United  States 
much  nearer  their  own  domiciles  than  the  market  town 
of  their  own  county,  and  for  these  farmers  it  may  be  a 
saving  to  pay  the  duty  on  an  occasional  basket  of  eggs 
or  bag  of  grain  rather  than  to  spend  a  day's  time  in  trav- 
eling to  their  more  distant  home  market;  but  this  pos- 
sibility, probability  or  ascertained  fact  no  more  affects 
the  general  proposition  that  the  consumer  pays  the  cus- 
toms tax  on  imported  goods  than  the  taking  of  a  few 
buckets  of  water  from  the  Niagara  River  would  affect 
the  statement  that  the  waters  of  that  river  flow  into 
Lake  Ontario. 

The  price  of  wheat  in  this  country  and  in  Canada  is 
based  upon  the  price  for  which  it  sells  in  Liverpool, 
and,  so  far  as  price  is  concerned,  it  matters  not  at  all  to 
our  farmers  whether  the  surplus  wheat  of  North  Amer- 
ica is  handled  in  Canada  or  in  the  United  States,  for 
both  countries  are  equally  distant  from  the  market 
which  establishes  the  price,  and  may  reach  that  market 
at  the  same  cost  for  transportation ;  so  that  whether  the 
wheat  is  shipped  from  this  country  or  from  that,  the 
price  of  wheat  will  be  the  same  in  both,  and  hence  our 
farmers  cannot  possibly  be  injured  in  the  purchase  of 
Canada  wheat  by  shippers,  millers  or  consumers  in  the 
United  States. 

If  it  is  granted  —  and  it  must  be,  for  there  is  no  es- 
cape from  it  —  that  the  price  of  wheat  would  neither  be 


68  THE  CAXADIAy  FARMER  AND  //AS'  WHEAT. 

diminished  nor  increased  by  the  introduction  of  the 
Canadian  product  into  the  United  States,  it  must  also 
be  admitted  that  the  imposition  of  high  duties  for  the 
purpose  of  deterring  the  Canadian  from  seeking  a  mar- 
ket for  it  in  this  country,  is  extremely  unwise,  if  not  the 
rankest  of  legislative  folly.  If  he  were  induced  to  sell 
here,  he  would  buy  his  farm  supplies  here,  and  these 
supplies  would  in  the  main  be  the  product  of  our  own 
labor.  Again,  if  he  sold  here  our  workingmen  would 
find  employment  in  handling  the  grain  and  transporting 
it  to  the  seaboard,  and  possibly  to  its  ultimate  destina- 
tion abroad. 


X. 

FARM  PRODUCTS  IMPORTED  IN  1890  —  HOW  WE  OB- 
TAIN CHEAP  CLOTHING  —  THE  EXORBITANT  PRO- 
TECTION ACCORDED  TO  THE  WOOLEN  MANUFAC- 
TURER—  THE  M'KINLEY  law  DOES  NOT  LESSEN 
IMPORTATION  OF  WOOL  —  THE  WOOLEN  MANUFAC- 
TURERS' association's  influence  POLITICALLY 
—  IT  MAKES  THE  PRICE  OF  AMERICAN  WOOL  — 
THE  M'KINLEY  LAW  DISCRIMINATES  AGAINST  THE 
AMERICAN  WOOL  GROWER  —  FACTS  FOR  THE  OHIO 
FARMER  TO   CONSIDER  —  HIDES  AND  SKINS. 

In  a  speech  at  Niles,  Ohio,  1891,  Governor  McKin- 
ley  said : 

"It  is  over  and  over  again  asserted  that  the  farmer  cannot 
possibly  be  benefited  by  a  tariff  on  farm  products  —  that  he  has  a 
surplus,  and  therefore  that  he  must  seek  a  foreign  market  to  dis- 
pose of  it.^  There  seems  to  be  a  general  impression  that  no  pro- 
ducts come  into  the  United  States  in  competition  with  American 
farm  products.  An  examination  of  the  imports  of  1890  most  ef- 
fectually disposes  of  this  assumption.  Let  me  enumerate  some  of 
them:  (1)  Value  of  cattle,  horses  and  sheep  imported  in  1890, 
$3,270,277;  (2)  breadstufls,  $6,034,272;  (3)  fruits,  $13,871,809;  (4) 
hay,  $1,143,445;  (5)  hops,  $1,053,616  ;  (6)  flax,  $2,188,021 ;  (7)  hemp, 
$7,341,956 ;  (8)  meat  and  dairy  products,  $2,011,314 ;  (9)  rice,  $2,042,- 
120;  (10)  linseed,  flaxseed  and  other  seeds,  $3,530,631;  (11)  leaf 
tobacco,  $17,605,192;  (12)  vegetables,  $4,455,374;  (13)  wool,  $15,- 
264,083;  total,  $79,812,102." 

^  "  Farmers  are  one-half  the  community  ;  the  direct  benefits 
of  protection  lie  almost  wholly  with  the  other  half. 

*'  It  follows,  then,  that  the  burdens  of  protection  fall  chiefly 
on  farmers."— Pro/.  John  Bascom. 

(69) 


70  IMPOR  TA  TlOy  OF  FA  RM  PR  OD  UC  TS. 

"  Besides,  15,062,076  dozen  eggs  were  imported  in  1890,  worth 
easily  $1,500,000,  on  which  no  duty  whatever  was  paid.  It  will 
be  seen  that  in  1890  we  imported  fully  $80,000,000  worth  of  farm 
products,  many  of  which,  it  is  believed,  will  be  produced  here  un- 
der the  protection  afforded  by  the  new  tariff  law."  ^ 

The  several  items  enumerated  by  Governor  McKin- 
ley  will  be  considered  in  the  order  in  which  he  has 
placed  them. 

1.  "Value  of  cattle,  horses  and  sheep  imported  in 
1890,  $3,270,277."  The  whole  truth  is  that  the  value 
of  cattle,  horses  and  sheep  imported  in  1890  was  ^6,- 
766,932,  but  of  this  amount  ^3,496,655  was  paid  for  ani- 
mals which  were  "pure  bred  of  a  recognized  breed  and 
duly  registered;''  and  these  under  the  law  were  admit- 
ted free  of  duty.  Possibly  an  inconsiderable  number  of 
the  cattle,  horses  and  sheep  referred  to  by  Governor 
McKinley,  as  amounting  in  value  to  ;^3,270,277,  on 
which  duty  was  paid,  were  bought  in  Canada  or  else- 
where, for  use  or  food,  but  by  far  the  greater  number 
were  of  improved  breeds,  and  many  of  them  "  pure 
bred  of  recognized  breeds,"  but  not  "  duly  registered  in 
the  book  of  record  established  for  that  breed,"  and 
hence  under  the  law  made  dutiable,  although  imported 
from  Canada  or  from  Europe  especially  for  the  United 
States  farmer  and  used  by  him  for  breeding  purposes, 
and  for  the  improvement  of  his  live  stock.  The  duty 
paid  on  them,  therefore,  was  paid  by  the  farmer,  and 
was  a  burden  to  him,  not  a  benefit. 

Nobody  knows  better  than  Governor  McKinley  that 

'  "Of  all  classes,  those  devoted  to  agriculture  bear  the  heav- 
iest share  of  the  burden  laid  by  the  protective  tariff,  wbile  they 
reap  no  direct  benefit  from  it." — Chapin. 


IMPOR  TA  TION  OF  FARM  PRODUCTS.  71 

Americans  do  not  as  a  rule  import  either  cattle,  horses, 
hogs  or  sheep,  for  any  other  purpose  than  that  of  secur- 
ing superior  breeds  of  live  stock.  On  the  contrary  we 
are  large  exporters  of  domestic  animals,  and  in  the  very- 
year  of  1890,  to  which  he  refers,  we  sold  abroad  cattle, 
hogs,  horses,  mules  and  sheep  to  the  value  of  ;?33,638,- 
128.  May  we  not,  therefore,  claim  that  Governor  Mc- 
Kinley  did  not  speak  the  whole  truth,  when  he  affirmed 
that  the  live  stock  imported  in  1890  came  into  compe- 
tition with  the  products  of  the  American  farmer  ? 

2.  "  Breadstuffs  $6,034,272."  Of  this  amount  ;S5,- 
629,840  was  paid  for  Canadian  barley,  an  article  con- 
sidered by  American  brewers  superior  to  our  home 
product  for  the  manufacture  of  the  better  qualities  of 
beer  and  ale.  Indeed  it  is  claimed  that  the  best  malt- 
ing barley  in  the  world  is  produced  in  Canada  along 
the  shores  of  Lake  Ontario,  and  that  this  barley  does 
not  come  in  direct  competition  with  the  barley  of  our 
Western  states,  and  further  that  it  is  indispensable  to 
the  brewers  of  the  East.  But  we  will  waive  all  this  and 
assume  that  we  imported  the  amount  of  breadstuffs  in- 
dicated by  Governor  McKinley. 

The  greater  quantity  and  value  of  these  breadstuffs, 
with  the  possible  exception  of  barley,  came,  as  we 
know,  from  Canadian  farmers  living  just  across  a  bor- 
der line  extending  from  the  Atlantic  to  the  Pacific. 
Whether  a  Canadian  or  a  citizen  of  the  United  States 
paid  the  duty  on  them  is  perhaps  immaterial.  If  the 
Canadian  paid  it  his  action  was  exceptional ;  if  the  man 
on  this  side  of  the  boundary  line  paid  it,  it  was  a  loss 
to  him.     A  comparatively  small  amount   of  Mexican 


72  IMPOR  TA  TION  OF  FARM  PRODUCTS. 

and  Canadian  products  for  reasons  already  assigned, 
will  find  their  way  into  this  country,  let  the  tarifif  be 
what  it  may.  The  Canadian  with  his  basket,  or  possi- 
bly skiff  load,  of  truck  will  come  to  our  market  when- 
ever it  is  ten  or  fifteen  miles  nearer  than  his  own,  and 
just  so  the  citizen  of  the  United  States  will  go  to 
a  Canadian  market  with  small  quantities  of  farm  pro- 
ducts, when  it  is  ten  or  fifteen  miles  nearer  to  him  than 
his  own  county  town.  These  exchanges  of  products  in 
all  cases,  except  perhaps  that  of  barley,  are  made  for 
convenience  sake,  often  by  poor  people,  who  have 
neither  the  time  nor  the  means  to  travel  to  distant 
markets,  and  hence  are  compelled  to  submit  to  cruel 
exactions. 

But  let  the  stalwart  American  land  owner,  who 
keeps  open  house  and  a  hospitable  board,  and  who 
would  spurn  to  stoop  to  little  acts  of  meanness,  pause 
for  a  moment  to  scrutinize  the  petty  thing  which  Gov- 
ernor McKinley  plumes  himself  on  having  done  for  the 
farmer's  profit  and  advantage. 

The  Governor  tells  us  that  we  imported  in  1890 
breadstufis  amounting  in  value  to  a  little  over  ;^6,000,- 
000,  and  that  he  has  attempted  to  protect  us  against 
this  influx  of  food  products  by  the  imposition  of  higher 
duties ;  but  he  did  not  say  what  a  candid  man  should 
have  said,  that  while  he  was  acting  in  this  spirit  of 
illiberality,  the  people  abroad,  unmindful  of  his  narrow- 
ness, bought  from  the  farmers  of  the  United  States,  in 
1890,  breadstufis  amounting  in  value  to  ;^1 55,000,000! 

The  people  who  bought  these  immense  quantities  of 
our  farm  products  probably  did  not  even  think  of  keep- 


IMPORT  A  TION  OF  FARM  PRODUCTS.  73 

ing  us  out  of  their  markets  by  unfriendly  legislation ; 
and  yet  Governor  McKinley  assumes  that  he  is  render- 
ing the  farmers  of  the  greatest  republic  in  the  world  an 
important  service  by  seeking  to  stop  a  trifling  business 
which  filters  in  across  the  boundary  of  Canada  and  the 
United  States,  where,  in  the  ebb  and  flow  of  products, 
the  farmers  on  this  side  of  the  line  always  come  out 
ahead. 

3.  "  Fruits,  ;^13,871,809."  What  kind  of  fruits  did  we 
import  ?  Apples,  peaches,  pears  and  such  other  fruits 
as  are  abundant  in  the  Eastern  and  Middle  States  of  the 
Union?  No;  on  the  contrary,  we  sold  to  other  coun- 
tries in  1890  green  and  dried  apples,  amounting  in  value 
to  ^2,270,118,  and  our  total  export  of  fruits  for  that 
year  was  ;^4,059,547.  The  dutiable  fruits  imported  con- 
sisted of  figs,  raisins,  lemons,  oranges,  plums  and 
prunes,  and  such  tropical  or  sub-tropical  productions  as 
do  not  come  in  competition  with  the  hardier  fruits  of 
the  great  body  of  American  farmers. 

It  is  true  that  California  is  an  orange,  and  to  some 
extent,  a  raisin  producing  State ;  and  oranges  are  also 
grown  in  Florida ;  but  the  farmers  of  Ohio,  and,  in  fact, 
of  all  the  Eastern  and  Middle  States,  could  be  no  more 
benefited  by  a  customs  tax  on  fruits  than  they  would  be 
by  a  tax  on  ostriches.  It  is  impossible,  therefore,  to 
conceive  of  a  valid  reason  why  the  farmers  of  Ohio, 
who  are  content  to  make  an  annual  profit  of  fifteen 
dollars  per  acre  on  their  lands,  should  be  taxed  to  ena- 
ble the  people  of  California  to  gather  in  a  profit  of 
from  ;^300  to  $500  per  acre  on  their  orange  groves.  The 
orange  grower  should  at  least  be  required  to  show  that 


74  iMPORTA  rro.v  of  farm  products. 

he  cannot  stand  alone  before  asking  charity  from  the 
less  profitable,  but  self-sustaining  and  independent  in- 
dustries of  the  country. 

4.  "  Hay,  $1,143,445."  Our  exports  of  this  product 
in  1890  amounted  in  value  to  $567,558,  so  that  the  bal- 
ance against  us  in  the  exchange  of  hay  was  only  ;^575,- 
887,  and  not  $1,143,445,  as  Governor  McKinley  would 
have  us  infer.  Has  any  Ohio,  or  Indiana,  farmer  ever 
seen  a  ton  of  foreign  grown  hay  ?  I  think  not,  and  yet 
for  the  past  ten  years  our  average  importation  of  this 
product  from  Canada  has  amounted  to  about  100,000 
tons  per  annum.  Nine-tenths  of  this  imported  hay 
came  into  the  country  through  the  Vermont  customs 
district,  and  the  amount  imported,  not  deducting,  of 
course,  the  amount  we  export,  is  equivalent  in  quantity 
and  value  to  less  than  one-fourth  of  one  per  cent,  of 
the  domestic  crop ;  that  is  to  say,  we  produce  about  65,- 
000,000  '  tons  in  this  country  and  import  about  100,000 
tons  from  Canada,  and  this  latter  amount  is  probably 
used  to  keep  life  in  the  live  stock  of  the  unfertile  re- 
gions of  New  England  adjacent  to  the  Canada  line.  It 
may  be  the  tariff  is  a  blessing  to  the  people  of  that 
sterile  section  of  our  common  country ;  but  it  is  not  at 
all  more  likely  that  they  grow  fat  on  it  than  that  their 
cows  do.  But  whether  they  do  or  not  is  a  matter  of 
trifling  importance  to  the  western  farmer,  so  far  as  his 
hay  crop  is  concerned,  for  this  crop  is,  in  the  main, 
consumed  in  the  feeding  of  horses  and  sheep,  and  in  the 
production  of  beef,  cheese  and  butter.  The  loss  of  the 
sale  of  100,000  tons  of  hay  would  not  in  any  event  di- 

1  In  1893  estimated  crop  65,776,159  tons. 


IMPOR  TA  TION  OF  FARM  PRODUCTS.  75 

minish  the  annual  profits  of  our  farming  population  to 
exceed  two  and  one-half  cents  per  capita. 

5.  "Hops,  ^1,053,616."  "The  Belgian  hops  have  a 
good  reputation,  but  those  of  Bavaria  are  best  of  all, 
the  aroma  being  more  perfectly  preserved  by  the 
method  in  practice  there.  The  American  hops  are  said 
to  be  very  powerful,  with  a  flavor  so  rank  and  peculiar 
that  unless  greatly  improved  by  cultivation  they  are 
not  likely  to  find  a  large  demand."'  It  is  assumed 
from  this  that  climate,  soil  and  culture  aSect  the  flavor 
of  the  hop  as  much  as  they  do  that  of  the  tobacco 
plant,  and  as  hops  are  used  to  impart  an  agreeable  bit- 
ter flavor  to  beer,  it  is  hardly  correct  to  say  that  the 
Belgian,  Bavarian  and  English  varieties  come  into 
direct  competition  with  the  ranker  flavored  American 
product.  That  the  latter  is  extensively  used,  both  here 
and  abroad,  in  combination  with  the  former,  may  be  in- 
ferred from  the  annual  statement  of  exports  and  im- 
ports. Next  to  Germany  the  United  States  is  the  largest 
exporter  of  hops  in  the  world,  and  in  ordinary  years 
we  produce  a  large  surplus,  and  in  such  years  no  tarifi 
can  be  of  any  advantage  to  the  hop  grower.  The  crop, 
however,  is  an  uncertain  one,  sometimes  very  abundant 
and  at  others  almost  a  total  failure.  In  1885,  for  in- 
stance, the  crop  was  most  plentiful,  and  in  that  year  we 
sold  abroad  over  13,000,000  pounds.  But  in  1886  it 
was  short,  and  our  imports  exceeded  our  exports  about 
10,000,000  pounds.  In  the  years  when  American  hops 
are  most  abundant,  however,  our  brewers  use  foreign 
hops,  either  in  combination  with  our  domestic  product 

1  Appleton's  Cyclopedia. 


/  6  I.MPOR  TA  TION  OF  FA RM  PRODUC TS. 

or  separately,  in  the  production  of  superior  qualities  of 
beer.  If  Governor  McKinley  had  desired  to  impart  the 
whole  truth  to  his  hearers  with  respect  to  the  hop  trade 
he  would  have  told  them  that  in  1890  we  imported  hops 
to  the  value  of  ;^1, 053,616,  and  exported  hops  to  the 
value  of  ^1,110,571,  and  that  in  this  exchange  of  hops 
the  balance  in  our  favor  was  $56,955.  In  the  year  1891 
the  showing  was  still  better  for  us ;  the  imports  were 
$1,797,406  and  the  exports  $2,327,474,  the  balance  in 
our  favor  being  $530,068.  These  figures  indicate  most 
clearly  that  the  demand  for  American  hops,  both  at 
home  and  abroad,  is  largely  increased  by  the  fact  that 
they  can  be  advantageously  used  in  combination  with 
the  foreign  product.  The  statement  that  it  is  neces- 
sary to  exclude  the  foreign  in  order  to  increase  the  sales 
of  the  domestic,  is,  therefore,  misleading,  if  not  wholly 
incorrect. 

6.  "  Flax,  $2,188,021."  Flax  is  raised  in  the  East- 
ern and  Middle  States  of  the  Union  for  the  seed.  It  is 
a  quick  crop,  and  soon  turned  into  money,  but  not  a 
favorite  crop  with  farmers,  because  it  exhausts  the  soil, 
and  in  the  long  run  is  found  to  be  unprofitable.  Since 
pioneer  times  the  farmers  of  Ohio,  and  of  many  other 
States,  have  given  little,  if  any,  attention  to  the  fiber, 
and  have  either  burned  it  or  permitted  it  to  rot  in  their 
fields  or  barnyards.  New  York,  Virginia  and  Ken- 
tucky have  attempted  to  turn  the  fiber  to  profitable 
use,  but  have  not  been  largely  successful  and  no 
amount  of  protection  could  induce  the  farmers  of  the 
country  generally  to  abandon  less  exhaustive  and 
more  profitable   lines   of   agriculture,  and   attempt  to 


IMPORT  A  TlOlsr  OF  FARM  PRODUCTS. 


compete  with  the  peasants  of  Belgium,  Holland  and 
Russia,  and  the  people  of  Ireland  and  Egypt  in  the 
preparation  of  the  flax  fiber  for  manufacture  into  linens, 
or  even  coarser  cloths.  It  is  absolutely  safe  to  say  that 
no  duty,  however  high,  could  tempt  an  Ohio  farmer  to 
grow  flax  with  a  view  to  manipulating  the  straw  in  or- 
der to  render  the  fiber  a  merchantable  product.  That 
the  flax  fiber  is  prepared  in  this  country  for  manufac- 
ture into  certain  coarse  fabrics  is,  however,  true ;  but 
that  the  finer  imported  flax  comes  into  competition 
with  the  American  product  to  any  appreciable  extent, 
is  simply  nonsense,  and  if  Governor  McKinley's  con- 
tention in  this  regard  "  fools  the  farmer,"  it  is  not  be- 
cause the  farmer  is  more  credulous  than  other  folks, 
but  because — to  use  Barnum's  suggestion — mankind 
like  to  be  humbugged. 

7.  "Hemp,;^7,341,956."  There  are  but  few  States  in 
the  Union  which  give  attention  to  the  culture  of 
hemp.  Ohio,  although  mentioned  as  one  of  the  four  in 
which  the  industry  has  been  successfully  prosecuted, 
has  now  comparatively  few  fields  devoted  to  it.  In  cer- 
tain sections  the  crop  is  raised  wholly  for  the  seed,  but 
in  Kentucky,  and  perhaps  to  some  considerable  extent 
in  Missouri,  and  possibly  in  Indiana,  it  is  cultivated  for 
the  fiber.  The  crop  is  an  exhaustive  one  on  the  soil, 
requires  much  care  and  cheap  labor  in  manipulation, 
and  hence  is  not  a  favorite  with  farmers. 

There  are  numerous  varieties  of  hemp,  all  having 
their  special  uses  and  adaptabilities.  There  are  some 
kinds— probably  many  kinds — imported,  which  cannot 
with  good  reason  be  claimed  to  come  into  competition 


78  IMPOR TA  TION  OF  FARM  PRODUCTS. 

with  the  American  product,  any  more  than  it  can  be 
fairly  claimed  that  coarse  cotton  or  woolen  cloths  com- 
pete with  the  finer  grades  of  silk.  Climate  has  much 
to  do  with  the  fiber  of  the  hemp  plant.  There  are 
plants  grown  which  produce  fine  elastic  fibers ;  others 
which  produce  fibers  of  coarse  and  brittle  texture ; 
fibers  suitable  for  cordage,  for  canvas,  for  sheeting, 
shirting,  towels  and  tablecloths,  and  fibers  from  which 
fabrics  equal  to  the  finest  Irish  linens  are  made.  How 
many  of  these  almost  endless  varieties  of  hemp  do  or 
do  not  come  into  competition  with  our  domestic  prod- 
uct, it  is  impossible  to  tell ;  some  we  know  are  abso- 
lutely necessary  to  us  in  the  production  of  the  finer 
qualities  of  goods,  and  some,  in  combination,  increase 
the  demand  for  our  home-grown  product.  Indeed 
these  various  qualities  of  hemp  are  as  indispensable  to 
the  manufacturer  as  a  complete  kit  of  tools  to  the  me- 
chanic, and  yet  the  McKinley  law  blindly  bears  down 
on  all  with  equal  heaviness,  "hemp  twenty-five  dollars 
per  ton  ;  hemp  hackled,  known  as  line  hemp,  fifty  dollars 
per  ton."  The  Ohio  farmer,  without  receiving  a  shadow 
of  benefit  in  leturn,  he^ps  pay  this  enormous  tax  when 
he  buys  his  towels,  table  linens,  and  cordage. 

The  States  in  which  hemp  is  produced  in  largest 

qv  )r  a  low  tariS,  and  hence  may,  with  good 

,  posed  not  to  regard  Governor  McKinley's 

hi  e  nonsense  as  essential  to  the  success  of 

either  tne  hemp  industry  or  any  other. 

8.  "Mea^  and  dairy  products  ;^2,011,314."  The 
Governor  was  sorely  pressed  for  suitable  material  when 
at  Niles  and  elsewhere  he  sought  to  beguile  the  farmer 


IMPOR  TA  TION  OF  FARM  PRODUCTS.  79 

into  the  belief  that  he  was  being  started  on  the  road  to 
opulence  by  high  protection  and  especially  by  the  M'Kin- 
ley  bill,  or  he  would  not  have  alluded  to  the  fact  that  in 
1890  we  imported  meat  and  dairy  products  to  the  value 
of  ^2,011,314.  Two  millions  of  course  is  a  large  sum 
to  be  expended  for  meat  and  dairy  products  when  beef 
and  pork,  butter  and  cheese,  are  so  abundant  with  us, 
but  the  farmers  of  the  United  States  will  derive  great 
comfort  from  the  fact  not  stated  by  Governor  McKinley, 
to-wit :  That  in  this  same  year  of  1890  we  sold  to  other 
countries  meat  and  dairy  products  amounting  in  value 
to  ;^136,264,506!  In  this  traffic  in  meat  and  dairy  pro- 
ducts, therefore,  the  American  farmer  lost  nothing ;  nay, 
he  made  something,  for  the  balance  in  his  favor  was 
over  ^134,000,000. 

Of  the  ^2,011,314  expended  abroad  for  the  articles 
in  question  $1,295,506  went  to  pay  for  certain  varieties 
of  cheese  not  made  in  this  country,  and  in  no  way  com- 
petitors of  our  home  product,  and  while  we  bought  $1,- 
295,506  worth  of  Neufchatel,  Gouda,  Westphalia  and 
other  rare  varieties,  including  cheese  made  of  goats' 
milk,  we  at  the  same  time  sold  to  other  countries  cheese 
and  other  dairy  products  amounting  in  value  to  ;^13,- 
081,856. 

9.  "  Rice,  $2,042,120."  I  assume,  without  knowing 
whether  my  assumption  is  entirely  correct  or  not,  that 
much  of  the  imported  rice  enters  the  country  through 
the  customs  districts  of  the  Pacific  States,  and  that  it  is 
brought  thither  as  return  freight  from  islands  with  which 
those  States  have  profitable  commerce.  The  people  of 
the  Northern  States  have  certainly  no  special  interest 


80  IMPORTA  TION  OF  FARM  PRODUCTS. 

in  rice,  except  to  obtain  what  little  they  make  use  of 
at  fair  prices.  The  States  of  the  Union  where  the 
product  is  an  important  one,  are  not  favorable  to  high 
protection,  and  if  they  accept  it  at  all  they  do  so  either 
under  protest  or  in  order  to  even  up  with  bounty-fed 
manufacturers  of  the  North. 

10.  "  Linseed,  flaxseed  and  other  seeds,  ^3,530,631." 
We  imported  in  1890  flaxseed  to  the  value  of  $1,- 
839,059  and  other  seeds  to  the  value  of  ;^691,574;  these 
two  sums  make  the  total  amount  stated  by  Governor 
McKinley.  The  bulk  of  the  expenditure,  as  will  be 
seen,  was  for  flaxseed,  a  crop  which,  for  reasons  stated, 
when  speaking  of  the  flax  culture  (item  6),  our  farmers 
do  not  care  to  raise.  The  importation  of  this  seed 
should  be  encouraged  by  low  duties  instead  of  restricted 
by  high  ones.  The  oil  obtained  from  it  is  used  by  every 
man  who  owns  a  house,  whether  it  be  the  cheapest  of 
frame  structures  or  the  most  elegant  of  mansions.  Any 
duty  or  tax  which  adds  to  the  cost  of  it  encourages  the 
unscrupulous  to  palm  off  inferior  oils  on  the  inexpert 
and  unsuspecting.  If  flaxseed  were  a  favorite  crop 
with  our  farmers  there  would  even  then  be  no  shadow 
of  excuse  for  the  imposition  of  high  duties,  for  it  can 
be  grown  in  this  country  as  cheaply  as  in  any  other ; 
but  it  is  not  a  favorite  crop  with  them.  The  yield  is 
light,  ranging  from  six  to  ten  bushels  per  acre ;  the 
straw  cannot  be  put  through  a  machine,  because  of  the 
toughness  of  its  fiber,  and  hence  the  seed  must  be  taken 
from  it  by  the  trampling  of  horses  or  by  the  old-fash- 
ioned flail ;  the  straw  after  threshing  is  of  no  value  as 
food  for  live  stock,  and  of  no  value  otherwise  to  the 


IMPOR TA  TIOJV  OF  FARM  PRODUCTS.  81 

average  farmer  —  not  even  as  a  fertilizer.  All  these 
considerations,  with  the  additional  one  that  the  crop 
exhausts  the  soil,  renders  it  so  objectionable  to  farmers 
generally  that  no  duty,  however  high,  and  no  bonus 
which  could  in  reason  be  offered  by  the  government, 
would  render  it  other  than  an  occasional  or  exceptional 
crop  in  the  United  States,  where  land,  without  material 
injury  to  the  soil,  can  be  made  to  yield  far  better  re- 
turns in  the  growing  of  grass,  wheat,  corn,  oats,  hay,  etc. 

It  is  true,  I  think,  that  there  would  be  little,  if  any, 
flaxseed  sown  in  Ohio,  if  the  manufacturers  of  linseed 
oil  did  not,  through  agents,  distribute  the  seed,  and  by 
persona]  solicitation  induce  farmers  to  sow  it. 

In  speaking  of  the  imports  of  seeds  in  1890,  it  would 
have  been  no  more  than  fair  for  Governor  McKinley  to 
have  mentioned  the  fact  that  we  exported  seeds  in  that 
year  to  the  value  of  ^2,637,888  and  oil  cake,  the  product 
of  seeds,  to  the  value  of  ^7,999,926 ;  so  that  in  this  ex- 
change of  seeds  and  their  product,  the  American  farmer 
and  trader  came  out  over  ^7,000,000  ahead,  and  certainly 
did  not  need  any  higher  protection  than  he  had. 

11.  *'Leaftobacco,;^17,605,192."  Much,  if  not  most, 
and  possibly  all  of  the  unmanufactured  tobacco,  brought 
to  this  country,  is  used  in  combination  with  our  domes- 
tic product.  It  imparts  to  the  latter  a  more  agreeable 
flavor  than  it  would  otherwise  have,  and  thereby,  unfor- 
tunately, perhaps,  increases  the  demand  for  it. 

In  any  fair  scheme  for  obtaining  revenue  for  the 
support  of  the  government,  tobacco,  which  is  not  only  a 
luxury  but  often  more  or  less  injurious  to  the  health  of 
the  consumer,  should  be  made  to  bear  the  heaviest  bur- 


82  IM PORTA  TION  OF  FARM  PRODUCTS. 

den  of  taxation,  and  this  taxation  should  be  imposed 
not  to  encourage  its  production,  but  to  diminish  its  con- 
sumption. We  do  not  place  a  heavy  duty  on  imported 
liquors  to  protect  our  American  distillers,  and  stimulate 
them  to  increase  their  product.  The  heavy  duty  is  im- 
posed to  limit  importation,  and  diminish  consumption, 
and  so  it  is  and  should  be  with  tobacco.  I  am  some- 
what surprised,  therefore,  to  find  that  Governor  McKin- 
ley  would  suggest  that  the  very  high  duty  on  tobacco 
was  imposed  for  the  purpose  of  encouraging  its  growth 
among  American  farmers,  and  shall  now  expect  to  find 
him  claiming  that  he  put  a  duty  of  two  dollars  and  fifty 
cents  per  gallon  on  brandy  to  encourage  its  produc- 
tion in  this  country.  The  truth  is,  that  neither  the 
whiskey  nor  tobacco  industries  need  encouragement. 
Like  ragweed  both  multiply  only  too  rapidly,  even 
under  influences  unfavorable  to  their  well  being. 

The  Governor  has  told  us  the  amount  of  leaf  tobacco 
imported  in  1890  was  in  value  $17,605,192;  to  this  he 
should  have  added  the  manufactured  tobacco  imported 
in  that  year,  ;$4, 105,262,  and  we  would  have  had  a  total 
of  ;^21, 710,454.  As  an  offset  to  these  large  importations 
he  should  have  told  his  hearers,  also,  that  we  exported 
in  1890  leaf  tobacco  valued  at  ;^21,479,550,  and  manu- 
factured, valued  at  $3,876,045,  making  the  total  of  our 
sales  abroad  $25,355,595.  The  balance  in  our  favor  in 
these  exchanges  of  tobacco  was  $3,645,141,  a  very  com- 
fortable sum  to  get,  and  in  this  case  Governor  McKinley, 
who  acts  upon  the  principle  that  international  commerce 
is  war,  may  congratulate  himself  upon  having  inflicted 
a  greater  amount  of  evil  upon  the  "  effete  monarchies 


IMPOR  TA  TION  OF  FARM  PRODUCTS.  83 

of  Europe  "  than  they  and  all  their  dependencies  in- 
flicted upon  us. 

12.  "  Vegetables,  1^4,455,374."  The  vegetables  im- 
ported in  1890  amounted  in  value,  as  Governor  McKin- 
ley  has  told  us,  to  ;^4,455,374.  Of  this  sum  ^1,307,772 
went  to  pay  for  beans  and  peas,  and  ^1,365,898  was  ex- 
pended for  potatoes.  Potatoes,  beans  and  peas  are  com- 
mon products  of  the  American  farm,  and  are  ordinarily 
very  abundant  and  so  cheap  that  no  nation  on  the  face 
of  tlie  earth  can  transport  them  hither  and  successfully 
compete  with  us  in  our  own  markets.  Occasionally, 
however,  the  potato  crop  is  almost  if  not  quite  a  total 
failure,  and  at  such  times  the  people  of  our  cities,  and 
especially  the  poor,  are  dependent  for  this  article  of 
prime  necessity  upon  other  countries.  In  years  of  av- 
erage plenty,  therefore,  the  farmer  needs  no  protection, 
and  in  periods  of  failure  protective  duties  could  do  him 
no  good,  and  would  do  the  people  of  our  great  cities  on 
the  seaboard  —  especially  those  dependent  for  their  sub- 
sistence upon  the  proceeds  of  their  daily  labor  —  almost 
infinite  harm,  by  increasing  the  price  and  thus  putting 
a  sufficiency  of  this  vegetable  beyond  their  reach.  The 
duty  of  twenty-five  cents  per  bushel  on  potatoes,  there- 
fore, is  not  only  absurd,  but  in  exceptional  cases,  ex- 
ceedingly severe.' 

There  was,  I  think,  no  failure  of  the  potato  crop  in 

1  "Ireland  sent  us  potatoes  all  last  year  and  took  our  corn; 
but  Congress  made  us  pay  a  penalty  of  more  than  one-third  of  all 
the  potatoes  imported ;  not  because  the  money  was  needed  for 
revenue,  but  for  the  express  purpose  of  preventing  us  from  buying 
good  Irish  potatoes  instead  of  rotten  American  ones." — Ihos.  O. 
S  hearman. 


84  IMPOR  TA  TION  OF  FARM  PRODUCTS. 

1890,  nor  of  the  bean  and  pea  crop,  and  I  assume  that 
our  importation  of  vegetables  for  the  year  named  was 
neither  unusually  large  nor  unusually  small,  but  about 
the  average  of  years  when  our  domestic  crops  are  fairly 
good.  How,  then,  it  may  be  asked,  is  this  importation 
of  vegetables  in  1890  accounted  for?  Simply  by  the 
fact  that  it  consisted  mainly  of  new  potatoes,  green 
peas  and  beans,  etc.,  brought  into  this  country  during 
the  fall,  winter  and  early  spring,  when  fresh  vegetables 
cannot  be  obtained  of  the  American  farmer,  from  places 
probably  like  Berm,uda  and  other  islands  where  summer 
continues  all  the  year,  or  where  seed  time  and  harvest 
are  not  the  same  as  with  us.  These  products,  therefore, 
do  not  enter  into  competition  with  ours  any  more  than 
the  green  corn,  known  as  roasting -ears,  competes  with 
the  hardened  corn  of  a  previous  year's  crop.  It  is  to  be 
regretted  that  Governor  McKinley  has  ridden  his  pro- 
tective hobby  to  such  an  extreme  as  to  insist  that  by 
diminishing  the  importation  of  fresh  vegetables  and 
attempting  to  compel  our  people  to  eat  old  potatoes, 
dried  beans  and  peas,  he  has  conferred  a  blessing  upon 
the  country. 

13.  "  Wool,  $15,264,083."  It  may  be  said  briefly, 
and  without  wearying  the  reader  with  details  not  nec- 
essary to  a  clear  understanding  of  the  main  features  of 
the  subject,  that  the  tariff  laws  of  the  United  States 
separate  the  wools  of  commerce  into  three  classes,  each 
class  being  so  essentially  different  as  to  be  easily  recog- 
nized. The  purposes  for  which  these  wools  are  used, 
either  separately  or  in  combination  with  each  other,  or 


IMPOR TA  TION  OF  FARM  PRODUCTS.  85 

in  combination  with  silk,  cotton,  flax,  hemp  or  hair,  are 
almost  infinite  in  number  and  variety. 

The  first  class  embraces  Merino  and  similar 
wools,  and  of  these  we  imported  in  1890 
to  the  value  of $3,894,760 

The   second,   long   or    combing   wools,   of 

which  our  imports  amounted  to 1,905,970 

The  third,  coarse  wools — wild  wools,  known 

as  carpet  wools 9,463,353 

Total,  including  hair,  etc ^15,264,083 

On  the  first  class  the  McKinley  law  placed  a  duty 
of  11  cents  per  pound  on  the  unwashed;  22  cents  on 
the  washed  and  33  cents  on  the  scoured.  Second  class, 
unwashed,  12  cents;  scoured,  36  cents.  Third  class 
wools  are  taxed  at  from  32  to  50  per  cent,  of  their  value, 
and  of  this  latter  class  it  will  be  observed  we  imported 
in  1890  $9,463,353,  or  nearly  two-thirds  in  value,  and 
nearly  eight-tenths  in  quantity  of  our  entire  impor- 
tations. 

It  should  be  remembered  that  under  the  McKinley  law 
the  duty  on  a  pound  of  scoured  wool  of  the  first  class 
is  thirty-three  cents,  let  its  value  or  cost  abroad  be  what 
it  may,  while  the  duty  on  scoured  wool  of  the  third 
class,  based  on  value  not  quantity,  rarely  if  ever  exceeds 
ten  cents  per  pound,  and  the  duty  on  washed  and  un- 
washed probably  rarely  exceeds  three  cents  per  pound. 
One  pound  of  third  class  scoured,  if  my  estimates  of 
cost  abroad  are  correct,  would,  duty  and  transportation 
added,  cost  the  American  manufacturer  not  over  thirty- 
two  cents,  and  this  one  pound  of  scoured  would  be 
equal  in  quantity  of  actual  wool  to  three  pounds  of 


86  IMPOR  TA  TION  OF  FARM  PRODUCTS. 

merino  wool  as  it  is  ordinarily  prepared  by  the  Ohio 
farmer  for  market.  In  other  words,  while  the  Ameri- 
can wool-grower  has,  by  the  cunning  devices  of  the 
woolen  manufacturer,  and  the  complicity  of  the  com- 
mittee, of  which  Governor  McKinley  was  chairman, 
been  deluded  into  the  belief  that  he  is  protected  against 
all  foreign  wools  to  the  extent  of  eleven  cents  a  pound 
on  the  unwashed,  twenty-two  cents  on  the  washed,  and 
from  thirty-three  to  thirty-six  on  the  scoured,  he  has 
had  practically  no  protection  at  all  against  at  least 
seven-tenths  of  the  wools,  and  substitutes  for  wool, 
brought  into  the  country. 

I  know  it  is  said  that  these  third  class  wools  are  not 
used  for  the  same  purposes  as  those  to  which  the  first 
and  second  classes  are  devoted.  This  statement  should 
be  true,  but  unfortunately  it  is  not,  and  these  cheap 
third  class  wools  are  now  found  in  combination  some- 
times with  better  wools,  sometimes  with  cotton,  some- 
times with  the  fiber  of  flax  and  hemp,  in  all  the  cheap 
carpets  and  low-priced,  so-called,  woolen  cloths  of  the 
country.  It  is  this  fact  which  enables  Governor  McKin- 
ley, while  advocating  high  protection,  to  boast  with 
some  show  of  plausibility  of  the  cheapness  of  men's 
clothing.  Why  should  they  not  be  cheap  indeed,  when 
made  of  inferior  wool,  mixed  with  shoddy  and  cotton, 
materials  practically  untaxed? 

On  the  pretence  of  afifording  the  American  wool- 
grower  eleven  cents  per  pound  protection  on  unwashed 
wool,  the  woolen  manufacturer  is  accorded  by  the  Mc- 
Kinley bill  prohibitory  duties,  and  no  one  who  reads 
paragraphs  391 ,  392, 393, 394  and  395  of  our  present  tariflf 


IMPORTATION  OF  FARM  PRODUCTS.  87 

law  can  reasonably  doubt  that  Hon.  Benton  McMillin, 
colleague  of  Governor  McKinley  on  the  Ways  and 
Means  Committee,  told  the  exact  truth  when  he  affirmed 
that  "whole  sections  of  the  bill  were  framed  by  inter- 
ested parties,  and  are  now  the  law  of  the  land.  This  is 
notably  true  of  the  sections  increasing  the  duties  on 
women's  dress  goods,  which  was  prepared  by  one  of  the 
greatest  manufacturers  of  those  goods." 

A  clause  of  paragraph  392  provides  that  on  woolens  or 
worsted  cloth,  etc.,  "valued  at  above  forty  cents  per 
pound,  the  duty  per  pound  shall  be  four  times  the  duty 
imposed  by  this  act  on  a  pound  of  unwashed  wool  of 
the  first  class,  and  in  addition  thereto  fifty  per  cent,  ad 
valorem?''  Now,  let  us  see  what  protection  the  manu- 
facturer is  allowed  on  this  pound  of  goods  valued  at 
above  forty  cents: 

Actual  value  of  goods,  say 41 

To  which  add  four  times  the  duty  imposed 

on  one  pound  unwashed  first  class  wool.   44 
Add  also  50  per  cent,  ad  valorem 20| 

And  we  have  a  total  of 105| 

or  64J  cents  protection  on  41  cents  worth  of  goods. 

It  is  claimed  that  the  specific  duty  of  forty- four 
cents  per  pound  of  cloth  accorded  to  the  manufacturer 
in  the  above  estimate  is  to  oSset  the  eleven  cents  per 
pound  allowed  the  wool-grower  on  four  pounds  of  un- 
washed wool,  which  are  supposed  to  have  gone  into  the 
pound  of  cloth ;  but  the  fact  is  that  the  law  does  not 
require  the  pound  of  cloth  to  be  made  of  American 
wool  at  all,  nor  of  any  raw  material  on  which  there  is  a 
duty  of  to  exceed  four  cents  per  pound  (counting  the 


88  I.VrOR TA  TION  OF  FARM  PRODUCTS. 

raw  material  unwashed  as  we  do  in  estimating  the  pro- 
tection accorded  to  American  wool).  The  law  says 
with  respect  to  the  material  which  shall  enter  into  the 
construction  of  this  pound  of  goods  that  it  may  be 
"  wholly  or  in  part  of  wool,  worsted,  the  hair  of  camel, 
goat,  alpaca,  or  other  animals,"  so  that,  in  fact,  the 
pound  of  cloth  may  be  one-fourth  wool,  one-half  cotton, 
and  one-fourth  ground  woolen  rags,  or  it  may  be  com- 
posed of  cheap  foreign  wool,  on  which  there  is  what  is 
equivalent  to  a  three-cent-per-pound  duty,  and  cotton 
on  which  no  duty  at  all  is  paid,  or  it  may  have  in  it  a 
trace,  more  or  less  pronounced,  of  good  wool,  on  which 
there  is  a  duty  of  eleven  cents  per  pound.  But  what- 
ever the  relative  proportions  of  the  materials  used  may 
be,  the  pound  of  cloth  is  protected  to  the  extent  of  over 
150  per  cent,  on  the  assumption  that  it  is  wholly  made 
of  first-class  American  wool,  or  first-class  foreign  wool, 
when  in  truth  and  in  fact  this  assumption  is  a  fiction  of 
the  law  maker,  under  and  by  virtue  of  which  the  woolen 
manufacturers  obtain  control  of  the  American  market, 
and  charge  whatever  prices  they  please  for  their  goods.' 
In  evidence  of  the  fact  that  the  higher  duties  im- 
posed by  the  McKinley  law  have  not  in  any  way 
checked  the  inflow  of  foreign  wool,  and  by  lessening 
competition  helped  the  American  wool-grower,  a  state- 
ment of  the  importations  for  a  series  of  years  is  given.' 

^  Hon.  William  Lawrence,  in  a  letter  to  the  Ohio  State  Journal^ 
July  21,  1891,  said:  "Last,  but  not  least,  (the  McKinley  law) 
makes  duties  substantially  prohibitory  on  the  importation  of 
most  kinds  of  woolen  and  worsted  goods." 

2  Clipped  from  New  York  Times  of  December  18,  1893.  Not 
entirely  accurate,  but  substantially  so. 


IMPORTATION  OF  FARM  PRODUCTS.  89 

IMPORTS  OF  WOOL  IN   POUNDS. 

All  kinds.  Cheap  Wools  or 

Carpet  Wools. 

1890 109,902,105  80,851,229 

1891 119,390,280  85,895,659 

1892 134,622,366  90,560,125 

1893 168,433,836  118,386,070 

It  will  be  seen  that  under  the  McKinley  law  the 
number  of  pounds  imported  has  gradually  increased, 
and  that  70  per  cent,  of  the  quantities  were  wools  which 
practically  pay  no  duty. 

The  following  paragraph  from  the  Bulletin  of  the 
American  Protective  Tariff  League  would  indicate  that 
the  wool-grower  can  look  for  no  protection  against  the 
cheap  wool  producing  countries : 

"  It  is  well  known  that  the  lowest  grades  of  carpet  wools  are 
from  wild  sheep  and  could  never  he  'produced  in  this  country, 
except  at  a  cost  for  production  which  ivould  require  from  500  to 
1000  per  cent,  of  protection,^'' 

The  average  value  of  these  cheap  wools  is  much  less 
than  ten  cents  per  pound,  and  an  ad  valorem  duty  of 
from  thirty-two  to  fifty  per  cent,  is  no  protection  to  the 
American  farmer. 

The  introduction  of  these  low  grade  wools,  however, 
and  their  abundant  use  in  the  manufacture  of  the  low 
priced  woolens  with  which  this  country  has  been 
flooded,  are  not  by  any  means  the  only  ways  in  which 
the  American  wool-grower  has  been  deluded  and  cir- 
cumvented under  the  so-called  protective  system. 

The  Woolen  Manufacturers'  Association  is  a  com- 
pact body  of  shrewd  business  men,  which  controls 
millions  of  capital,  and  wields  immense  political  influ- 


90  IMPOR  TA  riON  OF  FARM  PRODUCTS. 

ence.  Its  not  widely  distributed  membership  co-operate 
in  the  promotion  of  any  cause  deemed  beneficial  to  the 
association  with  machine-like  unity.  It  is  in  business 
what  a  well  equipped  army  is  in  war.  Its  influence  is 
felt  not  only  in  the  vicinity  of  its  mills,  but  this  influ- 
ence extends  to  every  congressional  district  in  which  it 
can  be  made  efifective  and  then  focuses  in  the  legisla- 
tive chambers  of  the  National  Capitol.  The  association 
sustains  its  political  champions  with  princely  liberality, 
not  perhaps  by  direct  donations,  but  by  contributions 
for  campaign  purposes  and  long  leases  of  official  power. 
To  it  one  hundred  thousand  dollars  is  proportionally  no 
more  than  a  five  dollar  bank-note  to  the  average  farmer. 
It  recognizes  the  power  of  money,  and  knows  enough 
to  use  it  discreetly,  if  not  at  all  times  honestly.  It,  in 
conjunction  with  other  manufacturing  industries,  sup- 
plies whatever  argument  its  political  emissaries  may 
require  in  fighting  its  battles  on  the  stump,  and,  what- 
ever editorials  the  high  tarifi"  press  may  need  to  recon- 
cile the  voter  to  the  absurd  doctrine  that  high  prices 
and  high  taxes  render  the  poor  folks  who  pay  them 
exceedingly  prosperous  and  happy 

This  association  fixes  the  price  of  American  wools. 
It  controls  the  only  market  in  which  the  wool-grower 
of  the  United  States  can  sell  a  pound  of  his  product. 
It  establishes  the  price,  and  from  its  decrees  there  is  no 
appeal.  It  may  buy  at  home,  but  it  is  not  obliged  to  do 
so.  It  can  keep  its  machinery  employed,  and  net  a 
profit  of  20  per  cent,  per  annum  on  its  capital,  under 
the  McKinley  law,  if  it  does  not  obtain  a  pound  of 
domestic  wool.     It   knows   that    the   American   wool- 


IMPORT  A  TION  OF  FARM  PRODUCTS.  91 

grower  must  sell  to  it  soon  or  late  at  whatever  price  it 
may  see  fit  to  pay,  and  hence,  if  the  association  can 
save  five  or  ten  cents  a  pound  on  the  whole  American 
clip  by  a  little  delay  in  purchasing  it  can  well  afford  to 
run  its  mills  certain  months  of  the  year  on  such  of  the 
better  grades  of  foreign  wool  as  it  may  need.  When 
the  duty  on  foreign  wool  was  raised  by  the  McKinley 
law  the  manufacturers  quietly  boasted  that  it  would  not 
increase  the  price  of  the  domestic,  and  it  did  not. 
Having  used  the  wool-growers  of  this  country  to  elevate 
the  price  of  their  own  half  shoddy  product'  the  manu- 
facturers have  been,  and  are  now,  taking  in  the  Ameri- 
can clip  at  their  own  prices,  without  regard  to  the  price 
of  foreign  wools,  or  to  tariff  rates. 

Again,  there  is  one  feature  of  the  existing  tariff  law 
which  operates  as  a  positive  discrimination  against  both 
the  American  wool-grower  and  the  American  consumer. 
This  is  the  system  of  drawbacks.  The  woolen  manu- 
facturer, if  he  were  to  make  his  cloth  of  domestic  wool, 
for  which  he  paid  what  foreign  wool  would  cost  with 
duty  added,  would  have  to  sell  his  product  in  the  home 
market  if  he  sold  at  all,  and  sell  at  a  high  price.  On 
the  other  hand,  if  the  goods  are  made  of  foreign  wool, 
he  may  sell  at  home  if  he  can  do  so,  or  he  may  export 

^  Two  years  ago  a  gentleman  made  a  statement  to  our  com- 
mittee remonstrating  against  putting  wool  on  the  free-list,  which 
we  were  proposing  to  do,  in  order  to  give  greater  employment  and 
cheaper  clothing  to  our  people,  because  the  duty  on  wool,  he  said, 
had  developed  a  great  American  industry  in  this  country,  which 
was  the  manufacture  of  shoddy.  He  said  we  have  815,000,000  of 
capital  invested  in  manufacturing  shoddy  goods,  and  employing  in 
that  branch  of  labor  100,000  hands.  And,  Mr.  Chairman,  just  in 
proportion  as  we  have  developed  the  shoddy  business  we  have  de- 
stroyed the  woolen  business. — Hon.  R.  Q.  Mills. 


92  IMPOR  TA  TlOy  OF  FARM  PRODUCTS. 

if  there  is  a  demand  abroad,  and  in  this  latter  case  the 
goverment  will  refund  to  him  the  duty  he  has  paid. 
This  duty,  on  the  better  grades  of  woolen  goods, 
would  amount  to  from  forty  to  sixty  per  cent,  of  the 
cost  of  the  raw  material. 

With  American  wool  at  the  price  of  foreign  wool, 
duty  added,  therefore,  the  manufacturer  is  practically 
restricted  by  the  law  to  the  American  market,  while 
with  foreign  wool  he  may  sell  at  home,  or  under  the  law 
compete  with  England  in  any  of  the  markets  of  the 
world.  Cheap  foreign  labor  will  not  prevent  this  com- 
petition, for  it  is  a  well  ascertained  truth  that  a  dollar's 
worth  of  American  labor  will  produce  more  yards  of 
woolen  goods  than  a  dollar's  worth  of  foreign  labor. 

The  gist  of  the  whole  matter  is  this  :  The  woolen 
manufacturers'  association  is  free  to  buy  where  it 
pleases,  and  if  it  sells  abroad  it  may  obtain  foreign 
wools  of  any  and  all  varieties  without  the  payment  of 
any  duty  or  tax,  and  may  sell  its  goods  to  foreigners  on 
as  good  terms  as  the  most  favored  manufacturers  of 
the  world.  It  is  only  in  the  United  States  that  this 
gigantic  combination  and  other  combines  equally 
grasping  and  merciless  are  enabled  by  protective  duties, 
ranging  from  60  to  150  per  cent,,  to  rob  the  American 
public  on  the  hollow  pretext  that  they  in  some  myster- 
ious, if  not  miraculous,  manner  benefit  the  working- 
man  and  help  the  farmer  by  selling  them  manu- 
ufactured  products  at  from  25  to  75  per  cent,  more  than 
the  goods  are  actually  worth.  A  wise  man  may  at 
times  be  excusable  for  accepting  an  agreeable  but  self- 
evident  untruth,  when  he  can  get  it  for  nothing;  but 


IMPOR  TA  TION  OF  FARM  PR  OD  UCTS.  93 

only  the  most  amiable  and  unthrifty  can  entertain, 
adopt  and  defend  an  ill-favored  and  ridiculous  false- 
hood like  that  propagated  by  the  high  protectionists 
when  it  costs  good  money  to  do  it. 

The  Ohio  farmer  should,  in  this  discussion,  squarely 
face  two  important  facts : 

1.  That  the  woolen  manufacturers  have  the  power, 
by  combination,  to  control  the  price  of  American  wool, 
and  that  they  will  not  permit  him  to  derive  any  advan- 
tage from  tariflf  laws. 

2.  That  his  greatest  competitor  in  the  better  class 
wools  is  the  wool-grower  of  California,  New  Mexico, 
Wyoming,  Texas,  Idaho  and  other  sections  of  the 
United  States,  where  grazing  land  costs  nothing,  winter 
feeding  is  not  required,  and  where  wool  can  be  profit- 
ably grown  at  less  than  ten  cents  a  pound.  Even  if 
foreign  wools  could  be  wholly  excluded  by  tariflf  laws, 
a  price  for  wool  which  would  render  the  industry  profit- 
able in  Ohio,  would  make  it  more  lucrative  than  a  gold 
mine  in  those  Western  States  and  Territories. 

In  concluding  on  this  branch  of  the  subject  I  desire 
to  call  attention  to  one  class  of  articles  of  great  interest 
to  farmers  which  Governor  McKinley,  either  intention- 
ally or  unintentionally,  neglected  to  mention.  He  was 
particularly  careful  to  tell  us  at  least  one-half  the  truth 
about  hay,  flax,  rice  and  vegetables  imported  in  1890, 
all  of  which  combined,  amounted  to  less  than  ^10,000,- 
000 ;  but  he  omitted  even  to  suggest  that  we  imported 
during  the  same  year  hides  and  skins  to  the  value  of 
;^21,881,886,  and  that  in  our  exchanges  of  these  articles 
the  balance  against  us  was  over  ;^20,000,000.    Have  not 


94  IMPOR  TA  riON  OF  FARM  PRODUCTS. 

the  farmers  of  Ohio  a  greater  interest  in  hides  and  skins 
than  in  rice?  Why,  therefore,  mention  the  one  and  ut- 
terly ignore  the  other?  Why  palter  about  an  expendi- 
ture of  a  million  more  or  less  for  hay,  and  say  nothing 
of  an  expenditure  of  nearly  522,000,000  for  hides  and 
skins  ?  The  latter  are  the  direct  product  of  the  farmer's 
hay — hay  in  its  most  condensed  and  valuable  results, 
and  yet  Governor  McKinley,  in  the  presence  of  Ohio 
farmers,  was  dumb  as  an  oyster  on  this  subject.  Why? 
Because  he  knew  if  he  were  to  suggest  it  the  farmers 
might  ask  ugly  questions — questions  which  from  his 
high  protection  standpoint  he  could  neither  consistently 
nor  satisfactorily  answer.  If  there  should  be  a  duty  on 
wool  and  cabbage  and  pickles,  why  not  on  the  skins  of 
our  sheep,  the  hides  of  our  cattle,  and  even  the  hair,  for 
this  is  an  article  of  commerce  ?  To  all  this  the  Gov- 
ernor could  have  made  but  one  truthful  answer,  to-wit, 
"the  leather  manufacturers  demanded  free  raw  material, 
and  in  accordance  with  a  rule  of  late  invariably  ad- 
hered to  by  the  Ways  and  Means  Committee,  we  gave 
to  the  manufacturers  exactly  what  they  wanted." 


XI. 

DRAWBACKS  (again). 

"  We  give  a  rebate  of  99  per  cent,  on  imported  raw  material 
which  is  finished  into  the  finished  product,  and  then  entered  for 
the  export  trade."  ^ 

This  reopens  an  old  question  which  has  already 
been  sufficiently  discussed  ;  but  it  may  be  well  in  this 
connection  to  inquire  who  got  the  rebate  of  99  per  cent, 
of  the  customs  tax  paid  by  the  Canadian  farmer,  referred 
to  by  Governor  McKinley  (see  page  Q6)  when  his  wheat 
the  raw  material — was  converted  into  flour — the  finished 
product  and  then  exported  ?  Was  the  amount  of  the 
rebate  paid  to  the  Canadian  farmer  or  to  the  manu- 
facturer? If  to  the  farmer  the  government  obtained 
no  revenue  from  the  transaction,  and  the  Canadian  got 
as  much  for  his  wheat  as  if  he  had  been  a  resident  of 
the  United  States.  If  to  the  manufacturer,  the  govern- 
ment derived  nothing  in  way  of  revenue,  and  the  man- 
ufacturer obtained  a  profit  to  which  he  was  not  justly 
entitled.  This  may  appear  like  trifling  with  an  im- 
portant subject,  but  it  illustrates  forcibly  the  ridiculous 
attitude  in  which  Governor  McKinley  places  himself 
logically,  when  he  affirms,  as  he  does  substantially, 
that  the  foreign  producer  pays  the  duty  and  the  Ameri- 
can manufacturer  gets  the  rebate. 

^  Governor  McKinley  at  Ada,  1891. 

(95) 


XII. 

POSITION   OF    THE    OLD    WHIGS    ON    THE    SUBJECT  OF 
PROTECTION. 

"  Let  me  call  as  witness,  first,  Thomas  Ewing,"  etc.  i 
Thomas  Ewing,  Horace  Greeley,  Henry  Clay  and  Mil- 
lard Filmore  were  old  Whigs  who  advocated  reasonable 
protection  for  so-called  infant  industries.  Their  utter- 
ances while  supporting  the  protective  theory  to  the  ex- 
tent indicated,  cannot,  without  great  injustice  to  their 
memories  and  disregard  of  their  avowed  purposes  be 
distorted  into  an  approval  of  continuous  and  permanent 
protection  to  long  and  well  established  industries. 
Henry  Clay,  in  1833,  gave  expression  to  the  views  of 
the  Whig  party  on  this  subject  when  he  said : 

"The  theory  of  protection  supposes,  too,  that  after  a  cer- 
tain time  the  protected  arts  will  have  acquired  such  strength  and 
perfection  as  will  enable  them,  subsequently  unaided,  to  stand 
against  foreign  competition." 

Again  in  1840: 

"No  one  in  the  commencement  of  the  protective  policy  ever 
supposed  that  it  was  to  be  perpetual." 

But  long  prior  to  Henry  Clay's  entrance  into  polit- 
ical life,  to-wit,  in  1791,  Alexander  Hamilton,  who  was 
a  leader  and  teacher  in  the  school  of  economic  states- 
men, to  which  Henry  Clay  and  Thomas  Ewing  be- 
longed, had  said  : 

1  Ada.  1891. 

CJG) 


POSITION  OF  THE  OLD  WHIGS  ON  PROTECTION.  97 

"The  continuance  of  bounties  on  manufactures  long  estab- 
lished must  always  be  of  questionable  policy,  because  the  pre- 
sumption would  arise  in  every  such  ease  that  there  were  natural 
and  inherent  impediments  to  success." 

To  affirm  that  the  fathers  of  the  old  Whig  party 
ever  contemplated  the  imposition  and  maintenance  of  a 
duty  of  ;^i3.44  per  ton  on  steel  rails,  an  article  which 
can  be  manufactured  in  this  country  and  sold  at  a  profit 
for  $1^  per  ton,  is  not  only  misleading  but  arrant  non- 
sense. Such  exorbitant  protection  to  an  industry  long 
established  would  have  been  denounced  by  them  as  an 
attempt  to  make  robbery  and  extortion  lawful. 

I  followed  the  tall  white  plume  of  Henry  Clay  with  all  the 
idolatry  of  boyhood  in  his  advocacy  of  his  great  American  Sys- 
tem half  a  century  ago.  I  was  tlien,  have  ever  been  and  am 
to-night  a  Clay  protectionist  (applause),  and  there  is  no  more 
similarity  between  the  McKinley  and  the  Clay  theories  of  pro- 
tection than  there  is  between  the  soaring  eagle  and  the  mousing 
owl.  Clay  protected  labor  when  our  manufacturing  industries 
were  in  their  infancy;  McKinley  protects  capital  when  industries 
are  fully  established,  breeds  monopoly  and  trusts,  limits  our 
markets,  oppresses  labor  by  lessening  employnaent  and  increased 
taxes  on  the  necessaries  of  life,  and  his  most  conspicuous  pro- 
ducts are  rapidly  multiplying  millionaires  and  tramps.  [Ap- 
plause.] 

The  Clay  protective  tariff  of  1842  levied  a  lower  rate  of  pro- 
tective taxes  than  the  Mills  bill  that  McKinley  now  calls  a  free 
trade  measure,  and  in  his  defense  of  protection  to  labor  he  never 
claimed  the  right  to  enact  anything  but  a  revenue  tariff,  with  in- 
cidental protection  for  a  very  brief  period,  as  he  held  that  con- 
tinued taxation  for  the  benefit  of  any  class  was  unjustifiable.  He 
held  free  raw  materials  as  one  of  the  integral  parts  of  protection 
to  labor  and  continued  taxes  on  some  of  them  for  a  season 
only  to  develop  them  fully,  and  as  early  as  1833,  when  urg- 
ing the  passage  of  the  compromise  tariff,  he  said  in  his  Senate 
speech  of  February  12,  1833:     "Now  give  us  time;  cease  all 

FLUCTUATIONS   FOB   NINE    YEARS   AND   THE    MANUFACTURERS    IN 
EVERY   BRANCH    WILL  SUSTAIN    THEMSELVES   AGAINST    FOREIGN 

COMPETITION." — Col.  A.  K.  McClurCy  September  2^^  1892. 


XIII. 

WHAT  M'KINLEY  CLAIMS  FOR  HIS  LAW — CONCEDING 
ALL  HE  CLAIMS  IS  IT  NOT  AN  ARGUMENT  IN  FAVOR 
OF  LOWER  DUTIES  AND  A  LARGER  FREE  LIST?  — 
THE  M'KINLEY  LAW  IN  SOME  RESPECTS  AN  IM- 
PROVEMENT ON   THE   LAW    OF    1883. 

"  What  has  this  bill  (MeKinley  bill)  doue?  In  the  first  ten 
months  under  that  bill  we  bought  more  goods  in  Europe  than  we 
ever  bought  in  any  ten  mouths  since  the  formation  of  the  govern- 
ment; *  *  *  more  and  bettor  than  that,  in  the  first  ten  months 
under  that  law  we  sold  more  products  to  Europe  than  we  ever 
sold  in  any  ten  months  before,"  etc.  ^ 

Again,  at  Beatrice,  1892,  in  a  speech  modestly  enti- 
tled "  The  Triumph  of  Protection,"  Governor  MeKin- 
ley said : 

"Notwithstanding  the  cry  that  under  a  protective  tariff  we 
cannot  sell  abroad  if  we  do  not  buy  abroad,  yet  during  the  last 
fiscal  year  we  sold  abroad  nearly  $203,000,000  more  than  we  bought 
abroad.  *  *  It  will  be  observed  that  under  the  operation  of  the 
new  law  the  free  list  has  been  increased,  while  the  dutiable  list  is 
decreased.  The  value  of  free  imports  for  the  last  year  exceeded 
the  value  of  dutiable  imports  by  $88,000,000.  During  the  last  fis- 
cal year  the  value  of  imported  merchandise  free  of  duty  was  over 
$458,000,000,  an  increase  over  the  preceding  year  of  $91,759,793. 
*  *  «  The  average  rate  (of  duty)  to-day  is  less  than  it  has  been 
at  any  time  before  for  thirty  years.  More  than  one-half  of  the 
value  of  all  our  imports  is  absolutely  free.  *  *  *  The  value  of 
our  exports  of  merchandise  during  the  fiscal  year  1892  was  $1,030,- 
335,626.  *  «  *  Our  exports  never  before  reached  that  point  in 
any  given  year  in  all  our  history." 

^  Ada,  1891. 

(98) 


U'^I/A  r  Mc  KIN  LEY  CLAIMS  FOR  HIS  LA  W.  99 

Figures,  whether  old  or  new,  relevant  or  irrelevant, 
have  as  great  a  fascination  for  the  Governor  as  edge 
tools  for  children,  and  he  is  just  as  likely  to  get  hurt, 
logically,  while  handling  them,  as  a  child  is  to  become 
physically  disabled  in  a  room  full  of  razors. 

Let  us,  for  the  sake  of  good-fellowship,  concede  that 
the  very  large  quantity  of  goods  bought  in  Europe 
during  the  period  to  which  he  refers,  resulted  directly 
from  the  beneficent  provisions  of  the  McKinley  law! 
Now  where  does  the  confession  on  his  part  and  the  con- 
cession on  ours,  leave  his  numerous  arguments  against 
a  revenue  tariff?  His  main,  if  not  sole,  objection  to  a 
low  tariff'  is  that  it  encourages  our  people  to  buy  goods 
abroad — that  it  induces  large  importations,  that  it 
furnishes  employment  to  the  foreign  laborer,  that  it  opens 
"up  our  markets  to  the  foreign  producer,  impoverish- 
ing the  home  producer  and  enriching  his  foreign  rival." 
And  yet  now  that  the  McKinley  law  has  the  field  he 
boastingly  affirms  that  under  it  "we  bought  more  goods 
in  Europe  than  we  ever  bought"  in  the  same  time  "since 
the  formation  of  the  government" — more  goods  even 
than  were  bought  under  the  revenue  tariff  of  1846, 
which  he  has  time  and  again  denounced  as  the  worst 
tariff  our  country  ever  had,  because  it  encouraged  peo- 
ple to  buy  goods  abroad. 

But  without  paying  further  attention  to  Governor 
McKinley's  inconsistencies  of  speech  and  self  contra- 
dictions in  argument,  let  us  simply  admit  that  all  he 
claims  in  this  particular  for  the  McKinley  law  is  abso- 
lutely correct ;  that  under  it  we  have  bought  more  and 
sold  more  than  we  ever  bought  and  sold  before ;  that 


100  Pf^I/A  T  McKINLEY  CLAIMS  FOR  HIS  LA  /K. 

these  large  purchases  abroad  and  large  sales  abroad, 
have  contributed  to  the  prosperity  of  the  country.  Hav- 
ing conceded  all  this — all  he  claims  with  respect  to  the 
goods  sold  and  bought,  and  the  beneficial  efiects  of  this 
buying  and  selling,  may  we  not  commend  him  to  cer- 
tain paragraphs  of  his  own  speech  for  the  causes  of  this 
unexampled  prosperity?  "The  average  rate  of  duty 
today  is  less  than  it  has  been  at  any  time  before  for 
thirty  years.'''*  And  again,  "more  than  one-half  of  the 
value  of  our  imports  is  absolutely  free."  And  again, 
"under  the  operation  of  the  new  law  the  free  list  has 
been  increased  while  the  dutiable  list  is  decreased." 
And  again,  "the  value  of  free  imports  for  the  last  year 
exceeded  the  value  of  dutiable  imports  by  ;^88,()00,000." 

May  we  not,  from  his  own  confessions,  therefore,  af- 
firm that  under  a  still  more  liberal  law,  with  a  longer 
free  list  and  lower  duties,  we  would  do  a  still  more  ex- 
tensive and  profitable  business  with  European  coun- 
tries? Do  not  his  own  figures  prove  that  low  duties 
lead  to  a  larger  trade,  and  that  larger  trade  leads  to  in- 
creased prosperity  ?  And  if  all  this  means  anything  is 
it  not  an  unanswerable  argument  against  the  restrictive 
policy  of  high  protection  ? 

The  McKinley  law  is,  in  some  respects,  an  improve- 
ment on  that  which  preceded  it.  It  reduced  duties  on 
a  few  things ;  it  enlarged  the  free  list ;  it,  in  a  small 
degree,  gave  recognition  to  the  policy  of  reciprocity; 
but  in  many  ways  it  is  more  objectionable  than  any 
tarifif  law  the  country   ever  previously   had.'      It  has 

^  The  passage  of  the  McKinley  law  of  1890  was  the  greatest 
blunder  ever  committed  by  any  party  since  the  Democratic  crime 
of  secession.— >iSV.  Louis  Globe- Democrat  {Hepub.). 


IVHA  T  McKINLE  Y  CLAIMS  FOR  HIS  LA  IV.  101 

made  duties,  which  were  too  high  before,  still  higher. 
It  has  given  to  many  lines  of  industry  a  monopoly  of 
the  American  market  by  according  to  them  prohibitory 
duties  on  competing  products.  It  lacks  that  apparent 
spirit  and  intent  of  absolute  fairness  and  impartiality  to 
every  individual  and  all  vocations  which  should  char- 
acterize all  laws  of  a  general  nature.  In  brief,  while  it 
is  not  without  good  features,  it  yet  has  many  which  are 
wholly  indefensible. 


XIV. 

INFLUENCE  OF  INVENTION  ON  PRICES  —  QUOTATION 
FROM  AN  ARTICLE  WRITTEN  BY  W.  E.  SIMONDS, 
EX-COMMISSIONER   OF   PATENTS. 

"  Things  were  never  as  cheap  as  they  are  to-day,"  etc.  ^ 
This  is  true  in  all  civilized  countries ;  the  invention, 
improvement  and  general  use  of  labor-saving  machin- 
ery readily  accounts  for  this  cheapening  of  products, 
whether  grown  or  manufactured.  The  putting  on  of  a 
duty  or  tax  never  made  a  thing  cheaper.  We  cannot 
diminish  by  addition.  With  respect  to  the  influence  of 
invention  upon  prices,  Hon.  W.  E.  Simonds,  ex-Com- 
missioner of  Patents,  said:  "Banish  our  agricultural 
inventions  and  the  entire  population  of  the  United 
States  *  *  *  would  not  suffice  to  raise  and  care 
for  half  of  our  present  crops."  *  *  It  was  Whitney's 
improvement  in  cotton  gins  that  made  cotton  into 
king.  *  *  *  Under  the  old  order  of  things  the 
value  of  each  bushel  of  this  grain  (wheat  and  oats) 
would  have  been  consumed  in  carting  it  from  Omaha  to 
Chicago.  *  *  *  No  delusion  is  more  surely  a  delu- 
sion than  the  somewhat  common  one  that  inventions 
lessen  the  wages  and  the  number  of  manual  laborers. 
The  same  kind  of  mechanics  who  now  gets  two  dollars 
and  fifty  cents  per  day,  received  not  more  than  one-half 
that  wages  in  1843.     *     *     *     The  history  of  American 

1  Ada,  1891. 

(102) 


INFLUENCE  OF  INVENTION  ON  PRICES.  103 

carpet-making  is  instructive  upon  this  point,  and  also  in 
showing  how  inventions  reduce  prices  in  the  long  run. 
A  generation  ago  our  carpets  were  all  made  for  us  by- 
foreign  hands,  and  the  prices  were  excessive.  A  great 
American  inventor  produced  the  Biglow  carpet  loom. 
To-day  the  prices  of  carpets  are  less  than  half  what 
they  were.''  ' 

1  North  American  Beview,  December,  1893. 


XV. 

SUGAR  AND  THE  SUGAR  BOUNTY. 

"There  has  been  an  annual  saving  of  $45,000,000  to  the 
American  people,  and  you  never  had  sugar  so  cheap  as  you  have 
got  it  to-day,"  etc.  ^ 

If  the  abolition  of  duties  and  the  admission  of  goods 
free  is  a  saving  to  the  people,  why  not  abolish  all  duties 
and  thus  make  an  annual  saving  of  ;^200,000,000  ?  The 
truth  is  the  tax  stricken  from  sugar  has  been  put  on 
other  things,  and  will  be  collected  from  the  people,  and 
in  addition  thereto  ;^10,000,000  will  be  extorted  from 
them  to  pay  bounties  to  home  sugar-makers.  The 
people,  therefore,  have  not  saved  forty-five  cents  by  the 
abolition  of  the  sugar  tax. 

1  Ada,  1891. 


(104) 


XVI. 


DOES     A     HIGH     TARIFF     CREATE     COMPETITION     AND 
ENCOURAGE   GENIUS? 

•'  We  have  created  competition."  ^ 

Is  competition  created  by  excluding  competitors  ? 
By  restricting  trade?  By  limiting  the  buyer  and  con- 
sumer to  one  market,  and  that  the  dearest?  By  putting 
a  duty  of  from  40  to  150  per  cent,  on  competing  foreign 
products?  By  encouraging  the  formation  of  pools, 
trusts  and  combines  ? 

"We  have  encouraged  genius;  we  have  promoted  inven- 
tion." 2 

No,  our  schools  have  done  these  things.  It  is  an 
era  of  invention  ;  our  whole  population  has  been  stim- 
ulated to  intellectual  activity.  The  high  tariff,  like  any 
other  tax  or  burden,  has  been  a  hindrance ;  but  in 
spite  of  this  we  have  made  progress. 

1  Ada,  1891. 
'  Ada,  1891. 


(105) 


XVII. 


CAUSE  OF  THE  PANIC  OF  1893 — CARNEGIE  —  RUSSELL 
—  DOLAN  —  SHERMAN  —  HEPBURN. 

"  The  truth  about  it  is  that  the  money  of  this  country  has 
been  so  good  that  when  the  peojjle  after  the  elections  last  fall  lost 
faith  in  everything  else  they  never  lost  confidenee  in  the  money 
of  the  country.  Every  man  who  .had  a  dollar  due  him  at  the 
bank  during  the  la^t  five  months  wanted  it,  and  he  wanted  it  bad  ; 
and  everybody  wanted  their  money  on  the  same  tlay.  They 
didn't  want  it  for  investment;  they  didn't  want  it  for  building 
any  industry,  for  we  are  not  building  industries  now ;  they 
wanted  it  because  they  believtd  in  it ;  wanted  it  near  them.  They 
drew  the  money  out  of  the  banks  to  hoard  it,  and  you  never  heard 
of  anybody  hoarding  anything  that  wasn't  good."  ^ 

From  the  day  of  Mr.  Cleveland's  election  in  Novem- 
ber, 1892,  to  the  first  of  June,  1893,  business  of  all 
kinds  was  carried  on  with  unabated  vigor,  and  with 
perhaps  more  than  average  profit.  For  two  years  or 
more,  however,  prior  to  the  retirement  of  Mr,  Harri- 
son from  the  executive  ofiice  it  had  been  manifest  to 
students  of  finance,  not  only  of  this  country,  but  of 
Europe,  that  what  was  known  as  the  Sherman  law  of 
1890  would,  if  left  unamended,  or  unrepealed,  ulti- 
mately lead  to  the  destruction  of  American  credit 
abroad,  and  to  the  serious  injury,  if  not  utter  paralysis 
of  all  business  at  home. 

Early  in  1891  our  exports  of  gold  became  so  large 
that  the  country,  from  March  to  July,  trembled  on  the 

1  McKinley's  campaign  speech,  1893. 

(106) 


CAUSE  OF  THE  PANIC  OF  iSgj.  107 

verge  of  a  monetary  panic,  and  was  only  saved  from 
financial  disaster  by  fortuitous  good  harvests  in  this 
country  and  bad  harvests  in  the  British  Islands  and 
continental  Europe.  Our  unprecedented  export  of  bread- 
stufifs  in  the  latter  part  of  1891,  induced  by  short  crops 
abroad,  led  at  once  to  a  return  of  the  gold  which  had 
been  frightened  away  by  our  silver  legislation,  and  this 
afforded  a  false  but  plausible  argument  in  favor  of  the 
continuance  of  the  Sherman  law,  to  the  party  which 
had  originated  it,  to  legislators  who  desired  a  ready 
market  for  the  silver  product  of  their  constituents,  and 
to  that  great  multitude  of  inspired  statesmen  and  idiotic 
financiers  who,  like  Jack  Cade,  are  eagerly  looking  for- 
ward to  the  blessed  day  when  a  two-penny  loaf  shall, 
by  an  exercise  of  legislative  authority,  be  sold  for  a 
half-penny.  That  the  purchasing  clause  of  the  Sher- 
man law  was  ultimately  the  direct  and  only  cause  of 
the  panic  to  which  Governor  McKinley  has  referred,  can 
be  demonstrated  as  clearly,  and  as  absolutely,  as  the 
fact  that  the  monetary  disturbances  which  led  to  the 
impoverishment  of  France  1719-20  were  the  direct  out- 
growth of  the  plausible  but  impracticable  financial 
vagaries  of  John  Law. 

As  has  been  stated  the  business  of  the  country  had 
been  flowing  with  at  least  ordinary  volume  in  all  the 
channels  of  trade  and  manufacture  up  to  the  latter  part 
of  May,  1893,  and  the  fact  that  the  country's  stock  of 
gold,  in  the  absence  of  any  unusual  demand  for  our 
breadstuffs  abroad,  was  again  rapidly  diminishing,  had 
apparently  passed  unobserved  by  the  great  majority  of 
our  people.     But  now  by  circulars  from  the  banks  of 


108  CAUSE  OF  THE  PANIC  OF  jSgj. 

New  York  City,  and  by  editorials  of  the  entire  press  of 
the  country,  they  were  suddenly  awakened  to  the  fact 
that  our  European  creditors  had  become  alarmed  over 
the  probability  that  our  obligations  to  them  would  be 
paid  in  silver  dollars,  intrinsically  worth  but  sixty-six 
cents  each,  and  hence  were  hurrying  our  certificates  of 
indebtedness  home  for  immediate  payment.  This  led 
to  a  rapid  decline  in  stocks  and  bonds  ;  unsettled  public 
confidence  in  this  class  of  investment  securities,  ren- 
dered it  difficult,  if  not  impossible,  to  borrow  money  on 
them  or  to  continue  loans  already  made,  and  to  prose- 
cute enterprises  in  hand  or  in  contemplation,  and  this 
condition  of  affairs  led  to  numerous  failures,  not  only  in 
the  great  money  centers,  but  elsewhere,  and  these  fail- 
ures being  paraded  in  startling  headlines  by  all  the 
newspapers  of  the  country  imbued  the  great  mass  of  our 
people  with  the  belief  that  banks  were  unreliable  cus- 
todians of  their  money,  and  hence  as  Governor  McKin- 
ley  said,  "They  drew  their  money  out  of  the  banks  to 
hoard  it."  Indeed,  they  became  so  thoroughly  alarmed 
that  they  withdrew  from  the  national  banks  alone  over 
1^350,000,000  '  and  probably  as  much  more  from  the  sav- 
ings, state  and  private  banks  of  the  country.  To  affirm, 
therefore,  that  anybody  who  depended  upon  banks  for 
accommodations  could  continue  business  amid  this  tem- 
pest of  distrust  and  excitement,  is  to  give  utterance  to 
an  absurdity.  Merchants  could  not  borrow ;  manufac- 
turers could  not  obtain  money  to  pay  employes;  State 
and  municipal  bonds  could  not  be  sold.     In  brief,  the 

'  Comptroller  of  the  Currency. 


CAUSE  OF  THE  PANIC  OF  iSgj.  109 

Nation  had,  with  respect  to  its  monetary  and  business 
aflfairs,  a  recurrence  of  its  experiences  of  1873,  when 
its  currency  disappeared  as  suddenly  as  if  it  had  been 
wholly  destroyed. 

The  panic  of  1893  began  in  the  latter  part  of  May 
and  continued  through  the  months  of  June,  July,  August 
and  September.  It  reached  the  maximum  of  its  fury 
about  the  middle  of  August,  and  began  visibly  to  abate 
when  the  House  of  Representatives  passed  the  bill  to 
repeal  the  purchasing  clause  of  the  Sherman  act.  The 
long  delay  and  idiotic  chatter  of  the  Senate  over  the 
matter  prolonged  the  feeling  of  distrust,  and  retarded 
business,  but  from  the  hour  when  the  repeal  bill  finally 
became  a  law  all  indications  of  the  fright  disappeared, 
and  the  money  so  hastily  withdrawn  from  the  banks 
was  as  hastily  returned  to  them.  Indeed,  on  the  18th 
of  November,  the  New  York  banks  held  ^65,000,000 
over  and  above  the  25  per  cent,  reserve  which  the  law 
required  them  to  keep,  and  since  that  date  the  sum  in 
excess  of  their  legal  reserve,  has  reached  the  unprece- 
dented amount  of  ^102,000,000.  Mr.  Andrew  Carnegie 
attributed  the  panic  to  its  proper  cause  when  he  said, 
"There  is  no  reason  in  the  world  why  the  United 
States  should  not  be  as  prosperous  today  as  it  was  until 
recently,  except  one.  Owing  to  the  enormous  and  con- 
stantly increasing  amount  of  depreciated  silver  in  the 
treasury,  confidence  has  been  shaken  in  the  ability  of 
the  government  to  pay  its  currency  in  gold,  as  it  has 
promised." ' 

'  North  Americati  Review,  September,  1893. 


110  CAUSE  OF  THE  PANIC  OF  iSgj. 

When  Governor  McKinley,  in  his  campaign  speech 
of  1893,  affirmed  that  the  panic  was  attributable  to 
prospective  changes  in  the  tarifif  law,  he  not  only  made 
averments  which  could  not  be  sustained  by  an  appeal 
to  contemporaneous  events,  but  he  struck  a  vicious  and 
serious  blow  at  the  business  of  the  country  by  encour- 
aging and  augmenting  the  prevailing  distrust,  and  he 
did  it  for  personal  and  political  ends.  If  it  were  true 
as  Governor  McKinley  incorrectly  claimed,  that  our 
business  troubles  resulted  from  proposed  changes  in  the 
tariff,  it  must  follow  that  the  panic  would  not  only  have 
continued  to  the  end  of  1893,  but  enough  longer  to  give 
the  country  an  opportunity  to  try  the  amended  law,  and 
so  ascertain,  by  actual  experience,  whether  the  changes 
made  in  it  were  good,  bad  or  indifferent.  On  the  other 
hand,  if  it  were  true,  as  Mr.  Carnegie,  a  practical  and 
successful  business  man  maintained,  that  the  purchas- 
ing clause  of  the  Sherman  silver  law  was  the  cause  of 
our  monetary  and  industrial  troubles,  it  must  follow 
that  with  the  abolition  of  the  cause,  or  repeal  of  the 
law,  its  effects  would  disappear,  and  the  country  at  once 
become  more  hopeful  and  gradually  return  to  its  usual 
prosperous  condition.  The  fact  that  business  began  to 
revive  the  moment  the  purchasing  clause  of  the  Sher- 
man act  was  repealed  would  indicate,  conclusively, 
that  Mr.  Carnegie  was  right  and  that  Governor  McKin- 
ley's  alleged  cause  of  our  business  troubles  was  not  the 
true  one,  and  that  his  arguments  based  upon  the  con- 
dition of  the  country  at  the  time  he  made  them,  were 
wholly  unfounded  and  designed  simply  to  influence  the 
votes  of  the  temporarily  unemployed. 


CAUSE  OP  THE  PANIC  OP  iSgj.  Ill 

As  further  evidence  on  this  point  extracts  from  Gov- 
ernor Russell's  able  paper  in  the  North  American  Re- 
view of  December,  1893,  are  submitted  for  the  consider- 
ation of  the  reader : 

"  The  best  proof  that  this  was  the  cause  of  the  business 
depression  comes  from  business  itself.  In  the  midst  of  its  distress 
it  knew  and  stated  the  cause  of  it  and  the  remedy.  From  boards 
of  trade  and  business  centers  all  over  the  country  there  came  a 
imanimous  demand  for  what?  To  let  the  tariff  alone?  No,  but 
to  repeal  the  Sherman  bill." 

Thomas  Dolan,  the  well-known  protectionist  of 
Philadelphia,  and  of  its  Manufacturers' Club,  said:  "I 
believe  that  the  depression  is  almost  wholly  due  to  the 
silver  policy.  If  the  alarm  was  due  to  the  victory  of 
the  Democrats,  why  was  it  not  manifested  last  Novem- 
l-,ej-  p  *  *  5i«  Ijj  f^Qt^  JQ  ^}^e  woolen  business  every- 
thing went  swimmingly,  until  first  of  July." 

The  American  Wool  Reporter  said : 

"  The  depression  is  due  to  lack  of  confidence  in  the  stability 
of  our  currency." 

John  Sherman,  in  the  debate  in  the  U.  S.  Senate, 
said: 

"If  we  would  try  it  (  repeal  of  the  Sherman  act)  to-morrow 
we  would  gladden  the  hearts  of  millions  of  laboring  men  who  are 
now  being  turned  out  of  employment ;  we  would  relieve  the  busi- 
ness cares  of  thousands  of  men  whose  whole  fortunes  are  em- 
barked in  trade;  we  would  relieve  the  farmer  and  his  product, 
for  free  transportation  to  loreign  countries  now  clogged  for  want 
of  money.  In  the  present  condition  of  affairs  there  is  no  money 
to  buy  cotton,  or  corn,  or  wheat  for  foreign  consumption." 

Hon.  A.  B.  Hepburn,  late  Comptroller  of  the  Cur- 


112  CAUSE  OF  THE  PANIC  OF  1893. 

rency,  in  a  speech  before  the  Ohio  Bankers'  Association 

(non-partisan)  at  Cleveland,  Ohio,  said : 

"The  iuitial  cause  of  our  recent  panic  was  distrust  of  our  cur- 
rency, a  fear  of  the  free  coinage  of  silver,  and  a  conviction  that 
under  the  operations  of  the  Sherman  law  we  were  rapidly  ap- 
proaching the  condition  that  would  result  from  the  free  coinage  of 
silver,  at  a  ratio  of  sixteen  to  one,  while  the  commercial  ratio 
ranges  about  twenty- eight  to  one. 

•X-  »  «  *  «  *  »  * 

The  foreign  investor  first  took  fright  and  not  only  withheld 
further  investments,  but  sent  back  to  us  in  large  quantities  the 
securities  already  held  lest  the  future  miglit  compel  him  to  accept 
payment  in  depreciated  money.  Credit  generally  became 
alarmed,  and  the  hoarding  of  gold  followed.  The  currency  famine 
thus  inaugurated,  intensified  by  business  necessities,  sent  all  forms 
of  money  to  a  premium  and  taxed  the  resources  of  every  locality 
to  find  money  and  substitutes  for  money  for  the  transaction  of 
business," 

Persons  who  do  not  keep  a  record  of  the  weather  are 
not  easily  convinced  that  the  last  cold  day  is  not  the 
coldest  they  have  ever  experienced.  And  so  it  is  with 
respect  to  panics,  and  years  of  industrial  distress.  The 
last  always  seems  to  be  the  worst.  The  anxieties,  dis- 
comforts and  dangers  of  the  old  time  are  to  a  great 
extent  forgotten,  while  those  of  the  present  are  obtru- 
sive, demand  immediate  attention,  and  are  hence  hastily 
accepted  as  the  most  distressing  ever  known. 

Grant  was  President  in  1873,  both  branches  of  Con- 
gress had  round  Republican  majorities,  and  no  one  was 
at  all  alarmed  over  any  prospective  changes  in  the 
tariff  law,  and  yet  in  the  latter  end  of  that  year  busi- 
ness houses  from  the  Atlantic  to  the  Pacific  were  swept 
down  by  a  financial  cyclone  like  rotten  reeds  before  a 
tempest.     There  was  then  nothing  in  the  estimation  of 


CAUSE  OF  THE  PANIC  OF  iSgj.  113 

the  public  so  precious  as  spot  cash,  and  everybody 
began  to  clutch  and  hoard.  A  million  of  productive 
property  could  not  tempt  a  thousand  dollars  in  currency 
from  the  strong  box.  Business  men  theretofore  in  high 
credit  acknowledged  with  shamed  faces  their  inability 
to  meet  maturing  obligations.  Fear  of  bankruptcy 
and  ruin  dominated  every  thought  and  controlled  every 
action.  In  brief,  the  current  of  business  was  as  sud- 
denly congealed  as  a  stream  might  be  which  ventured 
into  the  frigid  temperature  of  an  arctic  winter.  -The 
country  was  five  years  in  recovering  from  this  disaster, 
and  failures  among  business  men  during  1876,  1877  and 
1878  were  proportionally  greater  than  in  1893,  while 
the  proportion  of  failures  in  1875  was  exactly  the  same  as 
in  1893,  In  other  words,  the  number  of  failures  in  1,000 
firms  in — 

1874  was  10.7  1877  was  13.6 

1875  was  13.0  1878  was  15.5 

1876  was  14.3  1893  was  13.0' 

In  1877  great  labor  riots  occurred  at  Pittsburgh  and 
elsewhere ;  it  was  during  this  year  that  Columbus  was 
terrorized  by  bands  of  discontented  workingmen.  In 
1878  unemployed  men  were  apparently  more  numerous 
than  the  employed.  In  1879  and  1880  there  were 
decided  indications  of  improvement,  but  in  the  latter 
of  these  years  Columbus  found  it  necessary  to  make 
provision  for  idle  men,  and  opened  a  free  hotel  for  their 
accommodation  at  the  corner  of  Spring  and  High 
streets.      In   1883  failures  among  business  men  were 

^  Dun's  Review,  January,  1894. 


114  CAUSE  OF  THE  PAX/C  OF  iSqj. 

proportionally  but  little  less  than  in  1893.  In  1884  the 
country  experienced  a  financial  panic  only  a  shade  less 
disastrous  than  that  from  which  it  has  just  emerged ; 
the  banks  of  New  York,  Boston  and  Philadelphia  were 
compelled  to  resort  to  the  system  of  clearing  house  cer- 
tificates to  avoid  suspension,  and  failures  among  mercan- 
tile firms  were  12.7  in  1,000,  only  a  fraction  less  than  in 
1893,  the  number  during  the  latter  year,  as  already  stated, 
being  13.0  in  1,000.  In  1890  there  was  another  financial 
panic,  during  which  the  banks  of  New  York,  Philadel- 
phia and  Boston  again  resorted  to  the  issuing  of  clear- 
ing house  loan  certificates  to  avoid  suspension,  and  but 
for  the  timely  purchase  of  government  bonds  by  the 
Secretary  of  the  Treasury,  and  the  disbursement  of  one 
hundred  millions  in  currency,  this  panic  would  proba- 
bly have  been  as  damaging  to  the  business  of  the 
country  as  the  last  one.  Notwithstanding  all  these 
facts,  however,  men  who  believe  their  political  success 
depends  upon  the  propagation  of  the  falsehood,  will 
maintain  that  the  panic  of  1893  was  the  worst  the 
country  has  ever  experienced,  and  that  it  was  directly 
attributable  to  prospective  changes  in  the  tariff  law, 
whereas  the  truth  is  that  the  panic  of  1873  was  fully 
as  disastrous  to  the  country  as  that  of  1893,  while  the 
panics  of  1884  and  1890  were  distressingly  injurious  to 
business,  and  the  years  1876, 1877  and  1878  were  unparal- 
leled for  the  number  of  failures  among  business  men. 


XVIII. 


THE  TARIFF  LAWS  NOT  DRLICATE  AND  SACRED  THINGS 
WHICH  CANNOT  BE  REVISED  AND  AMENDED  WITH- 
OUT INJURV  TO  THE  BUSINESS  OF  THE  COUNTRY 
—  M'MILLEN'S  STATEMENT  AS  TO  WHO  PREPARED 
THE  m'KINLEY  bill  —  JOHN  SHERMAN  ON  THE 
SAME    SUBJECT. 

"  Now,  my  fellow-citizens,  are  you  surprised  at  the  condition 
of  the  country?  If  you  are,  you  will  not  be  if  you  reflect  a 
moment.  For  thirty-two  years  this  country  was  under  a  protec- 
tive tariff,  and  during  all  that  time,  until  now,  there  was  no  party 
in  control  in  this  country  that  could  destroy  it.  Remember  that 
—  thirty-two  years  of  uninterrupted  protection,  and  no  party  able 
to  disturb  it.  Every  business  in  this  country  was  built  up  under 
that  protective  tariff;  every  industrial  interest  was  made  to  con- 
form to  it ;  every  delicate  thread  of  industry  entwined  about  it ; 
every  artery  of  trade  and  commerce  led  out  from  it.  Everything 
we  made,  everything  we  produced,  was  related  to  that  protective 
system.  The  cost  of  production,  the  selling  price,  the  cost  price, 
the  wages  of  labor,  were  all  adjusted  to  that  protective  systena 
that  had  continued  for  thirty-two  years."  ^ 

"  For  thirty-two  years  this  country  was  under  a  pro- 
tective tariff. " —  Multitudes  of  iniquitous  laws,  customs, 
precedents,  and  practices  have  become  hoary  with  age. 
We  have  had,  indeed,  nearly  one  hundred  years  of 
slavery  in  this  country,  during  which  human  beings 
were  bought  and  sold  at  private  and  public  sale ;  hus- 
bands ruthlessly  separated   from  wives,  parents  from 

^  Campaign  speech,  1893. 

(115) 


116  IFHO  PREPARED  THE  McKIXLEY  BILL. 

children,  and  "every  delicate  thread  of  industry  en- 
twined about''  this  accursed  institution,  and  pleaded  for 
its  continuance,  just  as  Governor  McKinley  pleads  for 
the  perpetuation  of  high  protection  and  prohibitory 
tariflfs.  Age  cannot  sanctify  a  wrong,  and  every  year 
through  which  robbery  is  continued  demonstrates  with 
cumulative  force  the  necessity  for  its  extinction. 

When  Governor  McKinley  abandons  declamation 
and  proves  by  ascertained  facts  and  pertinent  figures 
that  the  great  mass  of  our  people  are  benefited  by  giv- 
ing the  woolen  manufacturer  of  New  England,  and  the 
iron  and  steel  maker  west  of  the  Alleghenies,  a  monop- 
oly of  the  American  market,  thus  enabling  them,  by 
combines,  to  extort  from  the  consumer  from  twenty  to 
fifty  per  cent,  more  for  their  product  than  it  is  worth, 
he  will  do  what  he  has  never  hitherto  done  to-wit,  sup- 
ply the  world  with  a  substantial  reason  for  the  exist- 
ence of  a  high  tariff".  The  idea  that  the  tariff  laws  of  the 
United  States  are  delicate  and  sacred  things  which  can- 
not be  revised  and  amended,  without  destroying  the 
business  of  the  country,  is  about  as  ridiculous  a  notion 
as  a  sane  man  ever  entertained.  The  truth  is  there  have 
been  not  fewer  than  twenty  changes  in  these  laws  since 
1861,  and  the  McKinley  act  was  about  the  most  radical 
of  them  all,  for  it  unwisely  increased  the  tax  on  many 
articles,  wisely  reduced  it  on  some,  considerably  en- 
larged the  free  list,  and  paid  a  direct  bounty  to  the 
sugar  makers,  who  were  no  more  entitled  to  a  bounty 
than  the  hodcarriers.  In  brief,  this  law,  by  according 
to  certain  well  established  and  politically  influential  in- 
dustries, exorbitant  protection,  forfeited  all  just  claim  to 


IV HO  PREPARED  THE  McKINLEY  BILL.  117 

respectful  consideration."  In  this  connection  I  desire 
to  introdace  again  the  testimony  of  Hon.  Benton 
McMillin,  member  of  the  committee  of  the  House  of 
Representatives  which  is  supposed  to  have  prepared 
the  McKinley  bilL 

"The  manufacturers  were  called  in  and  allowed  to  frame  the 
schedules  to  suit  themselves,  ^yhole  sections  of  the  bill  were  thus 
framed  and  inserted  bodily  as  they  were  made  by  interested  par- 
ties, and  are  now  the  law  of  the  land.  This  is  notably  true  of  the 
sections  increasing  the  duty  on  women's  dress  goods,  which  was 
prepared  by  one  of  the  greatest  manufacturers  of  those  goods.  It 
was  true  of  others.  Does  any  one  deny  this?  The  members  of 
the  Ways  and  Means  Committee  who  'edited'  the  bill  will  not 
deny  it."  ^ 

McMillin's  emphatic  testimony  as  to  the  manner  in 
which  the  McKinley  bill  was  gotten  up  may  not  be 
readily  accepted  by  those  who  diflfer  with  him  politically  ; 
but  unfortunately  for  the  credit  of  our  legislators,  the 
public  has  the  evidence  of  Senator  John  Sherman  as  to 
the  substantial  accuracy  of  Mr.  McMillin's  statements. 
In  the  Cleveland  Leader  of  November  6,  1891,  Mr. 
Sherman,  while  speaking  of  the  McKinley  law*is  re- 
ported to  have  said:  "The  best  and  most  equitable 
tariff  bill  that  was  ever  framed  was  sent  into  congress 
by  the  commission  of  which  Harry  Oliver,  of  Pitts- 
burgh was  thepresident,  but  the  manufacturers  knocked 
it  to  pieces  by  inserting  into  it  all  sorts  of  petty  chimcr- 

1  The  recent  break  in  the  price  of  steel  lails  (from  5^29  per  ton 
to  $21.80)  is  said  to  be  due  to  the  action  of  a  Pittsburgli  concern 
which  refused  to  re-enter  the  agreement  between  the  mills  (or  tlie 
maintenance  of  a  stated  value  for  rails  when  it  expires  tirst  ol 
January. — New  York  Tribune,  Nov.  11,  1S93. 

^  North  American  Beview,  Oct.  1893. 

9 


118  WHO  PREPARED    THE  McKINLEY  BILL. 

ical  protection  for  pen-knives,  pearl  buttons  and  other 
Yankee  notions,  until  I  am  free  to  say  it  was  in  many 
respects  a  Yankee  notion  bill,  dealing  in  small  matters 
that  needed  no  protection.  *  *  *  The  tin-plate 
question  is  one  I  am  in  favor  of,  and  there  are  other 
important  business  enterprises  that  I  believe  should  be 
taken  under  our  wing,  but  the  Eastern  manufacturers 
are  constantly  making  an  effort  to  insert  themselves 
into  the  tariff  question  when  they  need  no  protection 
whatever." ' 

It  is  evident  that  these  manufacturers  succeeded  in 
inserting  themselves  into  the  McKinley  bill,  and  that 
notwithstanding  Governor  McKinley's  assertion  to  the 
contrary,  they  did  it  for  their  own  special  advantage 
and  not  for  that  of  the  consumer.  To  affirm,  therefore, 
that  the  prosperity  of  the  country  depends  upon  the 
maintenance  of  such  a  law,  unamended,  is  to  give  ut- 
terance to  a  palpable  absurdity. 

^"Protection  tends  to  demoralize  our  national  legislation. 
The  lobby  of  the  capitol  is  thronged  with  representatives  of  cer- 
tain manufacturers,  seeking  to  obtain  or  to  perpetuate  special  pro- 
tection. Money  is  freely  used,  and  bargains  are  made  to  combine 
the  friends  of  separate  measures,  when  votes  are  given.  Proposed 
acts  come  thus  to  be  judged  of  not  by  their  real  merits,  but  by 
their  relation  to  personal  interests." — Dr.  Chapin. 


XIX. 


SHALL  ALL  OLD  LAWS,  CUSTOMS  AND  PRECEDENTS  BE 
ADHERED  TO — THE  EFFECT  OF  THE  REDUCTION  OF 
TARIFF  RATES  ON  THE  IRON  INDUSTRY — THE  IRON 
MANUFACTURERS  ON  THE  SEABOARD  DEMAND  FREE 
IRON  ORE  AND  COAL — CERTAIN  MANUFACTURERS 
OBLIGED  TO  USE  FOREIGN  MADE  STEEL — STRIFE 
BETWEEN  EASTERN  AND  WESTERN  IRON  AND  STEEL 
PRODUCERS. 

"  I  don't  care  what  the  system  is,  any  industrial  system  that 
has  existed  thirty-two  years  in  a  country,  that  has  been  imbedded 
in  every  business  enterprise  and  in  every  human  activity,  if  you 
go  from  that  system  to  another  and  a  different  one,  you  paralyze 
the  business  of  the  country.  (Applause.)  Men  in  this  country 
— and  they  are  not  different  here  from  any  other  country— men  in 
this  country  do  not  produce  for  the  future  when  they  do  not  know 
what  the  future  will  be.  No  man  will  put  his  good  money  into 
that  end  of  the  factory  when  he  doesn't  know  what  he  will  get  for 
his  product  when  it  goes  out  at  the  other  end  of  the  factory.  No 
man  will  make  iron  and  steel  for  the  future  with  tariff  coal  and 
tariff  iron  ore  and  tariff  wages,  M'hen,  six  months  from  now,  that 
iron  and  steel  may  have  to  compete  with  iron  and  steel  made  with 
free  coal  and  free  iron  ore  and  with  free  trade  wages.  (Applause.) 
And  that  is  what  is  the  matter  with  the  country  today.  (Cheers.) 
Certainty  in  business,  confidence  in  the  future  constitute  the  es- 
sence of  business  prosperity.  (Cries  of  "Good,"  and  applause.) 
No  man  will  invest  his  money  in  any  industrial  enterprise  unless 
he  has  reasonable  assurance  of  a  profit.     Don't  forget  that."  ^ 

"  If  you  go  from  that  system  to  another  and  a  differ- 
ent one  you  paralyze  the  business  of  the  country." — 

1  Campaign  speech,  1891. 

(119) 


120  REDUCTION  OF  TARIFF  RA  TES—  ITS  EFFECT. 

If  this  be  true,  all  attempts  to  make  improvement, 
advancement,  or  progress  in  any  line  should  be  forbid- 
den by  the  Constitution  of  the  United  States.  The 
industrial  system  in  operation  at  any  time  should,  ac- 
cording to  the  Governor's  superior  wisdom,  be  resolutely 
adhered  to.  The  revenue  law  enacted  by  congress  in 
1789  should  have  been  continued  to  the  present  day. 
The  so-called  free  trade  tarifif  of  1846,  after  it  had 
become  "imbedded  in  every  business  enterprise  and 
every  human  activity,"  should  have  been  scrupu- 
lously maintained.  The  infant  industry  which  needed 
help  to  put  it  on  its  legs,  and  some  measure  of  pro- 
tection until  fairly  established,  should,  after  it  had 
become  old  and  strong  and  abundantly  able  to  stand 
alone,  continue  to  be  a  burden  upon  other  industries. 
The  internal  taxes  of  war  times  should  never  have 
been  repealed,  and  the  war  itself  should  have  been 
continued  because  it  made  manufacturing  profitable 
and  furnished  employment  to  millions  of  men  as 
soldiers,  as  agriculturalists  and  as  artisans.  The  in- 
consistencies, not  to  say  stolidities,  of  the  Governor  are 
marvelous ;  but  his  elocution  is  splendid  and  the  good 
people  are  sometimes  thoughtless,  and  somewhat  cred- 
ulous. 

"No  man  will  make  iron  and  steel  for  the  future  with  tariff 
coal  and  tariff  iron  ore,  *  *  when  six  months  from  now  that 
iron  and  steel  may  have  to  compete  with  iron  and  steel  made  of 
free  coal  and  free  ore,"  etc. 

This  revives  the  old  question  of  who  pays  the  tax  ? 
Governor  McKinley  has  repeatedly  afl&rmed  that  it  is 
paid  by  the  foreigner  for  permission  to  sell  his  goods  in 


REDUCTION  OF  TARIFF  RA  TES—ITS  EFFECT.  121 

the  American  market.  Notably  he  made  this  claim  at 
Atlanta,  Georgia,  at  Beatrice,  Nebraska,  at  Ada,  Ohio, 
and  he  has  made  it  at  numerous  other  places,  so  that 
he  stands  plainly  committed  to  the  doctrine  that  under 
the  protective  system  the  tarifif  is  a  tax  upon  foreign 
countries  "which  they  must  yield  up  to  our  treasury  if 
they  want  to  enter  this  market."  ' 

Now,  if  the  Governor's  old  contention  as  to  who 
pays  the  tax  is  well  founded,  it  must  follow  that  the 
manufacturer  can  make  iron  and  steel  as  cheaply 
from  tariS  coal  and  tarifif  ore,  as  he  can  make  them 
from  free  coal  and  free  ore.  In  other  words,  if  the  for- 
eigner pays  the  tax  or  duty  the  American  is  now,  and 
has  been  hitherto  getting  his  foreign  coal  and  ore  with- 
out the  payment  of  any  duty  —  at  free  trade  prices  —  at 
the  actual  cost  abroad  with  simply  transportation,  but 
no  duty  added.  Why,  therefore,  should  any  manufact- 
urer hesitate  to  make  iron  and  steel  for  the  future, 
with  the  probability  of  free  raw  material  before  him, 
when,  according  to  Governor  McKinley's  numerous 
afifirmations,  that  is  exactly  what  the  manufacturer  has 
been  doing  for  the  past  thirty-two  years? 

The  truth  is  the  Governor's  protective  system  is  of 
the  most  elastic  and  accommodating  nature,  and  may 
be  so  adjusted  as  to  meet  the  views  of  either  buyer  or 
seller.  To  the  former  it  says,  "The  foreigner  pays  the 
tax  and  the  price  of  goods  is  not  increased  thereby ; " 
to  the  latter,  "You  get  from  twenty  to  fifty  per  cent. 

1  Beatrice,  Nebraska,  1892. 


122  REDUCTION  OF  TARIFF  RATES— ITS  EFFECT. 

more  for  your  product  than  you  could  obtain  under  a 
low  tariflf." 

The  speech  from  which  the  citation  at  the  head  of 
this  chapter  is  made  was  delivered  for  the  last  time  on 
November  5,  1893.  On  the  22d  of  the  same  month  and 
year,  the  iron  and  steel  mills  at  Pittsburgh,  Youngs- 
town,  and  elsewhere  west  of  the  Alleghenies,  were 
either  in  active  operation  or  about  ready  to  resume. 
The  same  is  true  of  the  coal  mines  of  Ohio  and  Penn- 
sylvania, so  that  we  have  in  these  facts  a  practical 
refutation  of  the  Governor's  statements. 

It  may  be  said,  however,  in  a  general  way,  that  iron 
ore,  in  many  but  not  by  any  means  in  all  the  existing 
varieties,  can  be  obtained  as  cheaply  in  the  United 
States  as  in  any  country  of  the  world ;  but  in  order  to 
make  certain  grades  of  iron  and  steel  demanded  by  the 
trade,  ores  from  widely  separated  mines  must  be  assem- 
bled at  the  furnace,  and  in  certain  well-ascertained  pro- 
portions intermingled  and  smelted  into  one  common 
mass,  and  then  cast,  rolled  or  drawn  out  into  the  forms 
desired.  Many  of  our  iron  mines  would  be  almost,  if 
not  wholly,  valueless,  if  it  were  impossible  to  combine 
their  product  with  that  of  other  mines.  While  the 
mills  and  furnaces  west  of  the  Alleghenies  use  but 
little,  if  any,  foreign  ore,  and  of  course  no  foreign  coal, 
it  is  often  cheaper  for  mills  and  furnaces  located  on  the 
seaboard  to  obtain  the  qualifying  ore  needed  to  create 
the  exact  product  desired,  from  other  countries,  than  to 
transport  it  by  boat  and  rail  from  distant  sections  of  the 
United  States.  Indeed,  it  may  be  for  their  advantage 
to  buy  their  entire  stock  of  certain  rare  ores  abroad, 


REDUCTION  OF  TARIFF  RA  TES  —  ITS  EFFECT.  123 

rather  than  pay  freight  charges  from  mines  in  Minne- 
sota, Wisconsin  and  northern  Michigan. 

The  following  statement,  clipped  from  the  New 
York  Times  of  November  25,  1893,  suggests  at  least 
that  all  producers  of  iron  and  steel,  whether  capital- 
ists or  laborers,  are  not  eager  for  the  continuance 
of  the  duty  on  iron  ore : 

Frederick  W..  Wood,  president  and  receiver  of  the  Maryland 
Steel  Company,  and  second  vice  president  of  the  Pennsylvania 
Steel  Company,  made  an  important  statement  as  to  the  steel 
industry.     He  said: 

"  The  complexion  of  the  steel  business  in  this  country  has 
changed  most  decidedly  in  the  past  year.  It  is  all  due  to  the  dis- 
covery of  deposits  of  good  steel-making  ore  in  Michigan,  on  the 
banks  of  Lake  Superior.  The  ore  comes  from  what  are  known  as 
the  Messaba  Districts,  and  can  be  very  cheaply  mined  by  steam 
shovels  and  loaded  by  them  directly  on  the  cars. 

"  Owing  to  the  freight  charges  we  cannot,  of  course,  compete 
with  the  mills  west  of  the  Alleghenies  in  purchasing  this  ore. 
Nor  can  the  foreign  ore  from  Cuba  and  the  Mediterranean,  which 
we  use  entirely,  paj^ing  the  duty  of  seventy-five  cents  a  ton,  com- 
pete with  the  Western  ore.  The  result  is  that  our  steel  business 
has  gone  to  pot,  and  will  continue  so  if  the  Western  output  holds 
out  and  the  tariff  is  not  taken  off  the  raw  material. 

"If  the  tariff  is  taken  off  raw  material  we  will  be  able  to 
compete  on  even  terms  with  the  other  steel-making  companies. 
If  it  is  not,  I  don't  think  there  will  be  a  single  company  east  of 
the  Allegheny  Mountains  that  will  be  able  to  continue  operations 
in  steel  making  " 

Thus  it  will  be  seen  from  the  evidence  of  an  expert 
that  if  the  McKinley  tariff  law  should  remain  un- 
amended the  steel  business  east  of  the  Alleghenies  is 
likely  to  be  abandoned,  the  capital  invested  in  the 
numerous  plants  of  that  section  wholly  lost  and  thou- 


124  REDUCTION  OF  TARIFF  RA  TES  —  ITS  EFFECT. 

sands  of  workingmen,  resident  in  the  vicinity  of    the 
mills,  left  unemployed. 

But  as  further  evidence  on  this  point  it  should  be 
said  that  in  February,  1889,  598  iron  and  steel  con- 
cerns of  New  England,  "  including,  almost  without  ex- 
ception, every  one  of  importance,"  '  declared  in  a  state- 
ment to  congress  that  the  tendency  of  the  duties  on 
coaland  iron  ore  was  "  to  wipe  out  the  iron  and  steel  indus- 
tries, large  and  small,  of  New  England."  Again,  "  it 
is  *  *  *  the  duty  on  coal  and  crude  iron  that  is 
strangling  in  New  England  one  of  the  largest  of  all  the 
wonderful  industries  of  modern  days.''  *  *  *  * 
The  abolition  of  these  duties  will  not  only  keep  it  alive 
but  will  insure  its  tremendous  vitality  and  large  in- 
crease.'' 

It  should  be  said  also  in  this  connection  that  there 
are  certain  lines  of  industry  in  this  country  which  could 
not  be  followed  if  restricted,  either  in  whole  or  in  part, 
to  the  product  of  native  ores.  The  seamless  tubes 
manufactured  by  the  Shelby  (Ohio)  Tube  Company,  for 
instance,  cannot  be  made  from  American  steel.  To 
say  that  this  promising  industry  is  benefited  in  the 
slightest  degree  by  a  heavy  duty  on  the  steel  it  is  com- 
pelled to  use,  would  be  arrant  nonsense.  The  same 
may  be  said  truthfully  of  a  hundred  other  industries  — 
industries  dependent,  either  in  whole  or  in  part,  upon 
foreign  raw  material  for  their  existence.  The  president 
of  the  Elwood  (Indiana)  Tin  Plate  Company  admitted 
that  the  tin  plate  industry  in  this  country  would  be 

'  Governor  Russell,  North  American  Review,  December,  1893. 


REDUCTION  OF  TARIFF  RATES— ITS  EFFECT.  125 

stimulated  by  a  remission  of  the  duty  on  pig  tin.  But 
waiving  all  this,  let  us  return  to  the  subject  of  foreign 
iron  ores — the  ores  which  Governor  McKinley  thinks 
it  would  be  a  calamity  to  introduce  into  this  country  free 
of  duty. 

It  must  be  apparent  that  if  these  ores  were  on  the 
free  list,  they  would,  by  reason  of  distance  and  cost  of 
transportation,  never  constitute  more  than  a  small  pro- 
portion of  our  entire  finished  steel  and  iron  product; 
except  for  the  use  of  mills  on  the  seaboard,  they  would 
only  be  imported  when  indispensable  as  a  mixture  for 
our  more  common  and  cheaper  grades  of  ore.  To 
restrict  their  importation  by  the  imposition  of  high 
duties  would,  aside  from  revenue,  serve  no  other  pur- 
pose than  to  lessen  the  demand  for  labor,  reduce  the 
rate  of  wages,  and  bring  about  the  precise  results 
which  Governor  McKinley  is  professedly  anxious  to 
avoid. 

The  truth  is  that  the  iron  and  steel  makers  west  of 
the  Alleghenies  are  not  so  much  afraid  of  foreign  com- 
petition, in  case  the  duty  on  iron  ore  and  coal  is  stricken 
off,  as  they  are  of  domestic  competition.  They  propose 
to  either  crush  the  iron  and  steel  mills  of  New  England, 
or  compel  them  to  work  at  such  a  disadvantage  as  will 
enable  the  Western  mills  and  furnaces  to  monopolize  the 
lion's  share  of  the  American  market. 


XX. 


m"kinley's  assumption  that  a  low  tariff  would 
lessen  the  demand  for  labor  not  w^ell 
founded  —  when  people  abroad  buy  of  us 
they  pay  wages  to  our  workingmen. 

"  \Mi3',  what  is  a  lower  tai'iff  for  ?  A  lower  tariff  is  to  make  it 
easier  for  foreign  products  to  get  into  this  country.  That  is  what 
u  lower  tariff  is  for.  And  the  easier  it  is  for  foreign  products  to 
get  into  this  country,  the  more  will  come  in,  and  the  more  that 
come  in  the  less  we  will  make  at  home.  (Applause.)  And  the 
less  we  make  at  home  the  less  labor  we  will  employ  at  home. 
(  Applause.)  You  can  not  buy  your  goods  abroad  and  make  them 
at  home.  (Applause.)  If  you  buy  them  abroad  they  will  be 
made  by  labor  abroad.  If  you  buy  them  at  home  they  will  be 
made  by  labor  at  home,  and  wages  will  be  paid  at  home,  and 
wages  will  be  spent  at  home.  (Applause.)  If  you  buy  them 
abroad,  the  wages  will  be  paid  abroad  and  the  wages  will  be  spent 
abroad.  Every  foreign  product  that  comes  into  this  country  in 
competition  with  the  products  of  our  own  labor  displaces  just 
that  quantity  of  home  product ;  and  as  it  displaces  that  quantity 
of  home  product  it  displaces  the  home  man  who  makes  it.  "  (Ap- 
plause.) 

"  There  is  not  a  farmer  in  Hamilton  county  who  thinks  it 
wise  economy  to  hire  his  neighbor's  boys  to  do  his  work  when  he 
has  got  half  a  dozen  stalwart  boys  of  his  own  idle  at  home, 
(Laughter  and  applause.)  No  good  government  should  consider 
it  wise  economy  to  buy  its  goods  abroad  when  it  has  got  a  million 
unemployed  men  at  home.  (Great  applause  and  cheers.)  The 
more  that  is  done  at  home  the  better  wages  will  be  paid  at  home. 

"  If  there  is  one  day's  work  and  two  men  to  do  it,  neither  of 
them  will  get  as  good  pay  as  though  there  were  two  days'  work 
and  one  man  to  do  it.  (Applause.)  And  you  laboring  men  know 
(126) 


WORKINGMEN  BENEFITED  BY  FOREIGN  TRADE.  127 

that.  Free  trade  proposes  to  give  one  or  both  days'  work  to 
Europe.  Protectiou  proposes  to  keep  them  both  at  home. 
(Applause.)  " 

The  paragraphs  here  quoted,  plausible  as  they  appear 
to  the  unreflecting,  are  based  wholly  upon  a  false  as- 
sumption —  the  assumption  to-wit,  that  a  lower  tariff 
would  diminish  the  aggregate  value  of  our  annual  pro- 
duct, lessen  the  demand  for  labor,  and  the  wages  of  our 
workingmen.'  Governor  McKinley,  at  Ada,  Ohio,  in 
1891  and  at  Beatrice,  Nebraska,  in  1892,  unwittingly 
confessed  that  the  United  States  could  find  not  only  in- 
creased profit,  but  additional  employment  for  her 
workingmen  by  friendly  commercial  relations  and  an 
active  trade  with  other  nations.  At  Ada  he  said : 
"  What  has  this  bill  ^  done?  In  the  first  ten  months 
under  that  bill  we  bought  more  goods  in  Europe  than  we 
ever  bought  i7i  any  ten  months  before  since  the  formation 
of  the  government."  He  at  that  time  evidently  regarded 
these  large  purchases  abroad  —  the  largest  the  country 
had  ever  known,  under  any  tariff,  as  evidence  that  our 
countiy  was  in  a  highly  prosperous  condition.  He  cer- 
tainly did  not  on  that  occasion  deem  it  necessary  to  tell 
his  hearers  that  "  the  easier  it  is  for  foreign  products  to 

1  "  The  assumption  that  protection  creates  the  home  market  is 
a  fallacy.  These  centers  of  varied  industry  grow  up  naturally  and 
healthily  with  the  increase  of  population  and  wealth.  Mechanical 
genius,  the  investigating  turn  of  mind,  the  energy'  of  will-i^wer, 
managing  capacity — these  qualities  come  not  of  protective  tarifTs. 
They  are  the  gifts  ol  God  to  men.  Left  to  themselves,  and  stim- 
ulated by  competition,  they  spontaneously  lay  hold  on  all  gifts  of 
God  in  nature,  and,  using  all  available  capital,  set  up  the  work- 
shops ol  industry,  wherever  best  opportunities  are  presented." 
— Aaron  L.  Chapin,  D,  D. 

2  McKinley  bill. 


128  irORKlXGMEN  BEXEFITED  BY  FOREIGN  TRADE. 

get  into  this  country  the  more  will  come  in,  and  the 
more  that  comes  in  the  less  we  will  make  at  home,  and 
the  less  we  make  at  home  the  less  labor  we  will  employ 
at  home.  You  cannot  buy  your  goods  abroad  and  make 
them  at  home.  If  you  buy  them  abroad  they  will  be 
made  by  labor  abroad.  If  you  buy  them  at  home  they 
will  be  made  by  labor  at  home,  and  wages  will  be  spent 
at  home,"  etc.  There  was  not  a  word  of  all  this  either 
at  Ada  or  at  Beatrice.  On  the  contrary,  it  was  a  good 
thing  then  to  buy  abroad,  and  the  Governor  becomes 
jubilant  over  the  fact  that  under  the  benign  influence  of 
the  McKinley  bill  "  we  bought  more  goods  in  Europe 
than  we  ever  bought  in  any  ten  months  before  since  the 
formation  of  the  government!" 

Was  it  true  at  Ada  or  Beatrice,  in  any  broad,  practi- 
cal business  sense,  applicable  to  the  question  in  hand, 
that  "  the  more  (goods)  that  come  in  the  less  we  will 
make  at  home,  and  the  less  we  make  at  home  the  less 
labor  we  will  employ  at  home?"  '  Not  at  all.  If  not 
true  then  why  should  it  be  true  now  ?  The  Governor 
might  with  just  as  much  pertinency  have  said  to  his 
Ohio  audience,  "  If  you  buy  goods  in  New  York,  you 
cannot  buy  them  in  Cincinnati ;  the  fewer  pumpkins 
you  buy  in  Indiana  the  more  you  will  raise  in  your  own 
garden;  you  cannot  keep  the  pig  in  your  own  pig-sty 
if  the  pig  is  kept  in  the  pig-sty  of  the  butcher."     These 

^  "Some  other  gentlemen,  in  the  course  of  the  debate,  have 
spoken  of  the  price  paid  for  every  foreign  manufactured  article  as 
so  much  given  for  the  encouragement  of  foreign  labor  to  the  prej- 
udice of  our  own,  but  is  not  every  such  article  the  product  of  our 
own  labor  as  truly  as  if  we  had  manufactured  it  ourselves?  Our 
labor  has  earned  it  and  paid  tlie  price  for  it.  It  is  so  much  added 
to  the  stock  of  national  wealth." — Daniel  Webster. 


WORKINGMEN  BENEFITED  BY  FOREIGN  TRADE.  129 

are  truths,  of  course,  but  it  would  hardly  be  wisdom  to 
accept  them  as  the  basis  of  a  great  national  or  inter- 
national policy.  Governor  McKinley's  subtle  method 
of  argument,  though  unknown  to  Aristotle,  is  neverthe- 
less somewhat  antiquated.  It  was  invented  by  Mother 
Goose,  and  has  been  used  for  ages  to  amuse  infants. 

He  tells  us  in  his  speech  at  Ada  that  under  the 
McKinley  bill  *'  we  bought  more  goods  in  Europe  than 
we  ever  bought  *  *  before ; "  and  at  Beatrice  he 
boasts  that  "  during  the  last  fiscal  year  (1892)  the  value 
of  imported  Vi\QXQ\\2M^\SQ:  free  of  duty  was  over  ^$458, 000,- 
000,  an  increase  over  the  preceding  year  o^  ^91,759,- 
793.''  What  followed  these  immense  purchases  of 
foreign  goods  to  which  the  Governor  at  Ada  and  Beat- 
rice so  boastingly  refers  ?  Was  the  laboring  man  thrown 
out  of  employment  ?  No.  Were  his  wages  reduced  ? 
No.  Did  the  country  go  at  once  into  bankruptcy?  Not 
at  all.  What  then  followed  these  enormous  importa- 
tions ?  The  Governor  in  his  Ada  speech  answers :  "  We 
sold  more  American  products  than  we  ever  sold  before ; " 
and  at  Beatrice  he  said :  "  The  value  of  our  exports  of 
merchandise  during  the  fiscal  year  1892,  was  ;$1,030,- 
335,626.  *  *  Our  exports  never  before  reached  that 
point  in  any  given  year  in  all  our  history."  **  The  excess 
in  value  of  exports  over  imports  *  *  was  ^202,944,- 
342."^ 

Under  a  more  liberal  law  and  lower  duties  might  we 
not  then  reasonably  expect  to  buy  still  more  and  sell 
still  more?     If  increasing  the  free  list  resulted  not  only 

^  "  Commerce  is  always  an  exchange  of  produce  against  pro- 
duce. So  much  imported,  so  much  exported." — Prof.  Emile  De 
Laveleye. 


130  workingme:^  benefited  by  foreign  trade. 

in  an  increase  of  trade,  but,  as  was  the  case  in  1892,  in 
a  balance  in  our  favor  of  over  ;^202, 000,000,  why  should 
we  not  make  further  reductions  in  duties  and  further 
additions  to  the  free  list,  secure  a  larger  trade  and  a 
larger  cash  balance? ' 

When  we  exchange  a  dollar's  worth  of  our  own  sur- 
plus product  for  a  dollar's  worth  of  European  surplus 
product,  there  is  not  only  nothing  lost  to  us,  but  cer- 
tainly a  saving  of  one  dollar.  If  we  neglect  or  de- 
cline to  exchange  an  article  we  do  not  need  and  can- 
not sell  at  home,  and  which  costs  us  a  dollar's  worth  of 
labor,  for  some  article  we  do  need  and  which  costs  a  dol- 
lar's worth  of  labor  abroad,  exactly  two  dollars  in  labor 
may  be  lost,  to-wit:  the  dollar's  worth  of  labor  ex- 
pended on  the  surplus  product  we  cannot  use,  and  the 
dollar's  worth  of  labor  expended  on  the  foreign  surplus 
product  which  we  could  use  if  permitted  to  exchange 
our  —  to  us  valueless  —  product  for  it. 

When  we  export,  as  we  did  in  1892,  a  billion  dollars 
worth  of  American  products,  the  foreigner  —  not  the 
citizen  of  the  United  States  —  pays  the  American 
laborer  good  wages  for  creating  those  products,  and  so 
long  as  there  is  an  even  exchange  of  products  between 
two  countries  there  can  be  no  loss  to  either,  and  may  be 
much  gain  to  both.^     Still,  it  is  in  a  narrow  sense  true 

1  "Nothing,  however,  is  more  certain  than  that  if  America 
purchased  goods  more  largely  from  England,  the  English  people 
would  in  their  turn  increase  their  purchases  of  American  pro- 
duce."— Henry  Faucett. 

2  "'In  buying  of  a  foreigner,  the  Nation  really  does  no  more 
than  send  abroad  a  domestic  product  in  lieu  of  consuming  it  at 
home,  and  consume  in  its  place  the  foreign  ])roduct  received  in 
exchange." —  Jean-Baptiste  Say. 


WORKINGMEN  BENEFITED  BY  FOREIGN  TRADE.  131 

as  Governor  McKinley  says,  that  "  the  less  we  make  at 
home  the  less  labor  we  will  employ  at  home  ;  "  but  this 
weak  aphorism  does  not  by  any  means  prove  that  gen 
erous  dealing  and  an  active  trade  with  other  nations 
would  diminish  the  number  and  value  of  our  home  pro- 
ducts and  lessen  the  wages  of  our  workmen.  On  the 
contrary  we  have  abundant  reason  to  conclude  that 
such  a  course  would  stimulate  business  at  home,  and  cre- 
ate an  increased  demand  for  labor  by  giving  our  products 
a  value  which  under  present  unfavorable  trade  limita- 
tions they  do  not  possess. 

The  following  paragraphs  clipped  from  the  Ohio 
Farmer,  and  written  by  W.  T.  Bethune,  suggest  the 
gist  of  the  whole  matter: 

"  When  a  farmer  buys  manufactured  goods  with  the 
money  he  receives  for  his  wheat,  he  has  simply 
exchanged  his  labor  for  the  labor  of  other  men  engaged 
in  different  branches  of  production,  and  the  goods  he 
receives  for  his  money  are  as  much  the  product  of  his 
own  labor  as  they  would  be  had  he  expended  his  labor 
in  the  actual  making  of  the  goods.  The  same  holds 
true  of  our  national  trade. 

^tf  ^  ^  ^  ^If  ^4f  *\f  •1'  -x* 

•T*  'T*  •T*  'T*  'T*  *!*  'T*  'T^  't^ 

"  The  foreigners  grant  we  can  grow  wheat  cheaper 
than  they  can.  Mr.  Lawrence  acknowledges  that  the 
foreigners  can  grow  some  things  cheaper  than  we  can, 
therefore  by  each  growing  that  for  which  they  are  best 
fitted,  and  exchanging  one  for  the  other,  both  will  gain. 
Both  will  be  using  the  process  of  production  that 
requires  the  least  labor. 

"  But  our  high  tariff  friend  still  maintains  that  by 
obliging  us  to  produce  directly  instead  of  indirectly  we 


132  WORKINGMEN  BEXEFITED  BY  FOREIGN  TRADE. 

will  give  more  work  for  American  labor.  He  is  correct. 
By  obliging  ns  to  adopt  a  more  difficult  system  of  pro- 
duction it  will  be  necessary  to  expend  more  labor  to 
produce  the  same  result.  It  will  give  more  work  in 
the  same  way  that  a  wet  season  or  weedy  field  gives 
more  work  by  making  it  more  difficult  to  produce.'' ' 

"  If  you  buy  abroad  wages  will  be  paid  abroad,  and 
the  wages  will  be  spent  abroad,"  etc. —  True  enough, 
within  narrow  limits,  but  only  half  the  truth  applicable 
to  this  question.  If  the  people  abroad  buy  of  us  they 
will  pay  wages  to  us,  and  these  wages  will  be  spent 
with  us,  and  the  demand  for  labor  with  us  will  remain 
undiminished,  and,  as  has  been  said,  if  by  possibility 
we  exchange  something  we  do  not  need  for  something 
we  do  need,  we  shall  gain  by  the  transaction.  Governor 
McKinley  errs,  however,  when  he  affirms  that  "every 
foreign  product  that  comes  into  the  country  in  compe- 
tition with  products  of  our  own  labor  displaces  just  that 
quantity  of  home  product."  For,  if  the  quantity  which 
comes  in  is  cheaper  than  ours  it  would  displace  a  smaller 
value,  and  should  suggest  to  us  that  we  could  employ 
our  labor  in  more  profitable  ways  than  in  making  things 
under  unfavorable  circumstances  and  at  a  disadvantage. 
In  brief,  it  never  pays  anybody  to  spend  two  dollars' 
worth  of  labor  to  create  a  dollar's  worth  of  product.  It 
would  be  wiser  to  earn  the  two  dollars  at  some  profit- 
able occupation,  and  spend  one  dollar  for  the  product ; 
by  the  latter  method  there  would  be  a  dollar  gained, 
while  by  the  former  there  would  be  a  dollar  lost. 

^"The  aim  of  economics  is  not  to  increase  but  to  diminish 
labor.  If  I  can  obtain  a  yard  of  cloth  from  a  foreigner  by  means 
of  one  day's  work,  it  is  contrary  to  this  aim  to  force  me  to  spend 
two."— Pro/.  Emile  De  Laveleyc. 


XXI. 

UNEMPLOYED  MEN  —  WHY  ARE  THEY  UNEMPLOYED  — 
WE  CAN  NOT  SELL  UNLESS  WE  BUY. 

"  No  good  government  should  consider  it  wise  econ- 
omy to  buy  its  goods  abroad  when  it  has  got  a  million 
unemployed  men  at  home." — Possibly  not;  but  if  the 
government  has  a  million  of  unemployed  men  it  would 
be  high  time  for  it  to  scrutinize  its  industrial  system 
and  commercial  regulations,  with  a  view  to  ascertaining 
if  there  were  not  some  way  to  dispose  of  its  surplus 
products,  and  thereby  increase  the  demand  for  labor, 
and  provide  profitable  employment  for  its  citizens.    The 
merchant,  manufacturer,  or  farmer  who   has  but  one 
customer,  and  that  customer  himself,  is  not  likely  to  ac- 
cumulate great  wealth,  or  prove  a  friend  to  the  working- 
man,  and  a  help  to  the  community.     Niggardliness  and 
selfishness  in  business  never  led  to  an  extended  trade,  and 
the  successful  development  of  a  great  industry.     If  by 
buying  goods  abroad  the  Nation  can  sell  goods  abroad, 
and  at  the  end  of  the  year  figure  out  a  cash  balance  of  mil- 
lions, it  would  be  millions  ahead  in  the  year's  business 
and  this  balance  would  be  a  stimulus  to  wages  and  an 
encouragement  to  workingmen.     And  even  if  the  bal- 
ance were  not  in  actual  cash  but  in  such  products  as 
our  people  needed,  the  effect  upon  the  laborer  would  be 
substantially  the  same.     Cash  itself  is  not  as  valuable, 
either  to  the  Nation  or  the  individual,  as  the  products 

(133) 


lo4  UNEMPLOYED  MEN. 

for  which  it  is  exchanged,  and  if  we  can  get  most  of 
the  products  we  desire  in  exchange  for  products  we  do 
not  need,  we  may  at  times  find  profit  in  paying  a  cash 
balance  to  others.  People  who  can  get  all  they  want 
without  cash  have  little,  if  any,  use  for  money.  ' 

The  idea  that  the  United  States  can  sell  goods  to 
Europe  and  not  buy  goods  of  Europe,  is  wholly  er- 
roneous. In  the  first  place,  it  would  be  impossible  for 
olher  countries  to  pay  cash  for  all  the  products  they  buy 
of  us.  Our  exports  in  1892  amounted  to  one  thousand 
million  dollars ;  a  few  such  years  of  sales  abroad,  if 
nothing  were  accepted  by  us  in  return  but  gold,  would 
bankrupt  every  nation  with  which  we  dealt,  and  in  the 
end  leave  us  without  a  customer.  In  the  second  place, 
nations  would  not  be  inclined  to  buy  largely  and  liberally 
of  us,  if  we  declined  to  buy  largely  and  liberally  of  them. 
In  brief,  they  buy  where  they  sell,  and  if  England  can- 
not obtain  wheat  in  America  in  exchange  for  English 
products,  she  will  seek  her  wheat  in  Russia  and  else- 
where, and  leave  ours  to  waste  in  the  farmers'  granaries. 

Governor  McKinley  should  not  forget  in  this  con- 
nection that  under  the  low  tariff  of  1846  (a  tariff  whose 
duties  were  materially  reduced  by  the  help  of  a  Repub- 
lican House  of  Representatives  in  1857)  "the  American 
mercantile  marine  touched  its  highest  point  of  pros- 
perity" ^  that  during  this  period  *'  the  great  cotton  fac- 

1  "  Nobody  wants  to  keep  gold  unless  he  is  a  crazy  miser.  It  is 
the  very  i)()orest  kind  of  permanent  investment.  You  cannot  eat 
gold,  or  wear  gold,  or  cultivate  gold.  You  have  to  part  with  it, 
in  order  to  make  it  of  the  slightest  use.  The  man  to  whom  you 
lend  or  pay  it  looks  around  anxiously  for  the  first  chance  to  get  rid 
of  it  for  somethiug  better."— 77wmas  G.  Shearman. 

2  D.  A.  Wells. 


UNEMPLOYED  MEN.  135 

tories  of  New  England  sprang  into  existence  "  '  "  that 
from  1850  to  1860  farm  values  increased  101  per  cent. ; " 
that  "  the  increase  of  our  wealth  was  equivalent  to  126 
per  cent. ; ''  ="  that  "  the  business  of  the  country  was  in  a 
flourishing  condition,  money  *  *  abundant  *  * 
large  enterprises  *  *  undertaken,  and  the  prosperity 
of  the  country  *  *  general  and  apparently  genuine."  ^ 
In  view  of  all  these  facts  it  does  not  seem  at  all 
probable  that  the  prosperity  of  the  people  of  the  United 
States  is  solely  dependent  upon  the  continuance  of  a 
tarifif  law  "  prepared  by  the  manufacturers  "  '•  and 
*'  edited  "  by  a  committe  of  which  Major  McKinley  was 
chairman. 

1  D.  A.  Wells. 

2  W.  B.  Allisou. 

^  James  G.  Blaine, 
■i  McMillin. 


XXII. 


The  railroad  president  and  steel  rails  —  RE- 
DUCTION IN  PRICE  OF  STEEL  RAILS  DUE  TO  IN- 
VENTION AND  IMPROVEMENT  IN  METHODS  OF 
MANUFACTURE  —  WAGES  HAVE  ALWAYS  BEEN  HIGH- 
ER IN  THIS  COUNTRY  THAN  IN  OTHER  COUN- 
TRIES—  THE  DIFFERENCE  IN  PRICE  BETWEEN 
AMERICAN  LABOR  AND  ENGLISH  LABOR  IN  THE 
PRODUCTION  OF  STEEL  RAILS  —  WHY  M'KINLEY'S 
RAILROAD   PRESIDENT  WOULD  NOT  BUY. 

"  There  is  not  a  railroad  company  in  this  country  today  that 
is  buying  any  steel  rails.  Why  ?  The  president  of  a  railroad  com- 
pany told  me  why  his  company  was  not  buying.  He  said  that 
last  fall  they  had  made  up  their  minds  to  relay  a  large  part  of 
their  tracks.  That  would  have  meant  labor  for  the  trackmen. 
They  would  have  employed  thousands  of  men.  He  said  when 
the  elections  went  in  favor  of  free  trade,  his  company  made  up  its 
mind  they  would  not  buy  any  steel  rails.  And  I  asked  him  why. 
He  said,  because  the  Democratic  party  was  in  power,  and  it  was 
pledged  to  reduce  the  tariff  on  steel  rails  from  $12  a  ton  to  $5  a  ton ; 
and  be  said  if  they  reduced  the  tariff  to  $5  a  ton  his  company 
would  get  cheaper  rails  in  England  than  they  could  get  in  the 
United  States.  And  so  the  railroad  companies  of  this  country  are 
waiting  for  the  Democratic  party  to  reduce  the  tariff.  And  while 
they  are  waiting  for  the  Democratic  party  to  reduce  the  tariff,  the 
workiugmen  in  the  rail  mills  of  the  United  States  are  idle  and 
unemployed.  (Great  applause.)  For  if  the  railroad  companies  of 
this  country  do  not  buy  steel  rails  at  home,  there  will  be  no  labor 
nor  wages  for  the  steel  rail  maker  at  home." 

It  is,  ou  personal  grounds,  to  be  regretted  that  the 
exigencies  of  a  political  campaign  should  disturb  the 

(136) 


THE  RAILROAD  PRESIDENT  AND  STEEL  RAILS.  137 

mental  equipoise  of  Governor  McKinley  to  such  an  ex- 
tent as  to  lead  him  into  inconsistencies  of  speech  so 
palpable  and  preposterous  as  in  eflfect  to  supply  his 
opponents  with  weapons  for  his  own  destruction. 
Those,  however,  who  have  neither  a  well  established 
principle  to  guide  them,  nor  a  comprehensive  under- 
standing of  the  subject  in  hand,  are  not  unlikely  to  be- 
come entangled  and  finally  lost  in  a  labyrinth  of  self- 
contradictions  and  conflicting  statements. 

The  Governor,  it  will  be  borne  in  mind,  has  affirmed 
over  and  over  again  that  the  tariff  does  not  increase 
the  price  of  domestic  manufactures.  He  has  said, 
"  There  is  not  in  the  long  line  of  staple  products  con- 
sumed by  the  people  a  single  one  which  has  not  been 
cheapened  by  competition  at  home,  made  possible  by 
protective  duties."  '  He  has  summoned  the  Canadian 
farmer  to  bear  witness  that  the  foreign  producer  and 
not  the  American  consumer  pays  the  tariff  duty.  ^  He 
has  introduced  a  memorial  of  the  colonial  parliament 
of  Bermuda  ^  to  prove  that  the  exporter  and  not  the 
importer  —  the  foreign  producer  and  not  the  home 
buyer  and  consumer,  pays  the  customs  tax,  and  that  he 
does  so  for  the  privilege  of  entering  our  market  and 
selling  his  goods.  After  having  established  the  truth 
of  this  proposition,  by  what  he  deems  unimpeachable 
testimony  and  incontrovertible  argument,  he  now  intro- 
duces a  nameless  railroad  magnate  and  permits  him  to 
annihilate  this  most  delightful  and  comforting  theory 

^  Atlanta. 

2  Ada. 

3  Beatrice. 


138  THE  RAILROAD  PRESIDENT  AND  STEEL  RAILS. 

without  uttering  one  word  of  protest.  Indeed,  to  all 
intents  and  purposes  the  Governor  bows  obsequiously 
to  this  railroad  magnate,  and  in  eflfect  says:  ''  I  used 
to  think  differently,  my  lord,  but  I  see  now  you  are 
right;  the  consumer  not  only  pays  the  tax  on  dutiable 
goods,  but  a  price  equivalent  to  this  tax  on  domestic 
products,  and  by  waiting  until  the  tariff  on  steel  rails 
is  reduced  from  ;^13.44  per  ton  to  ;^5  per  ton,  you  will 
save  a  heap  of  money !"  What  a  humiliating  descent 
this  must  have  been  for  a  great  statesman,  who  had 
time  and  again  declared  that  the  tariflf  did  not  increase 
the  price  of  nails,  iron,  steel  rails,  etc. 

The  introduction  of  the  railroad  president  and  the 
subject  of  steel  rails,  suggest  a  few  facts  which  may 
properly  be  considered  at  this  point,  in  the  discussion. 
Steel  rails  were  at  one  time  sold  in  the  United  States  at 
;^155  per  ton.  In  1873,  however,  they  were  $95.90  here, 
and  $14:  in  England.  In  1885,  the  price  was  $2Q  in  this 
country,  and  $23.17  abroad.  For  many  years  it  was  the 
custom  of  a  certain  brood  of  half-fledged  political  ora- 
tors to  attribute  this  great  decline  in  price  to  the  cheap- 
ening effect  of  our  tariff  laws.  Indeed  the  broad  state- 
ment was  freely  made  that  a  high  rate  of  duty  had  re- 
duced the  price  of  steel  rails  from  $155  to  $26  per  ton, 
and  from  this  false  premise  it  was  argued  that  high 
tariffs  made  cheap  goods,  and  hence  were  a  blessing  to 
the  consumer.  The  truth  is,  however,  that  the  reduc- 
tion in  the  price  of  steel  rails,  and  other  forms  of  steel 
product  resulted  not  from  legislative  enactments,  but 
from  certain  important  discoveries  like  the  Bessemer 
process,  and  the  Gilchrist  and  Thomas  process,  and  also 


THE  RATLROAD  PRESIDENT  AND  STEEL  RAILS.  139 

from  certain  improvements  in  mill  machinery,  for  which 
mankind  is  wholly  indebted  to  the  inventive  genius  of 
the  age,  and  not  at  all  to  the  wisdom  of  political  econo- 
mists. If  it  were  true  that  high  tariffs  made  low  prices, 
steel  rails  would  be  cheaper  in  this  country  than  in 
England. 

While  wages  are  from  30  to  100  per  cent,  higher  in 
England  than  in  any  of  the  high  tariff  countries  of 
Europe,  it  is  admitted  that  workingmen,  as  a  rule,  have 
always  been  paid  less  money  for  a  day's  work  there,  than 
men  have  received  here  for  the  same  hours  of  labor ; 
but  this  was  just  as  true  when  England  was  a  high 
tariff  country,  and  the  United  States  a  low  tariff 
country,  as  it  is  to-day.  In  fact,  in  the  time  of 
William  Cobbett,  when  tariff  reform  was  agitating  Eng- 
land, wages  in  the  United  States  were  higher  than  in 
any  of  the  high  tariff  countries  of  Europe,  and  this 
country  was  then  "pointed  to  as  illustrating  the  bless- 
ings of  free  trade  and  low  taxes."  ^  From  these  facts  it 
may  be  fairly  assumed  that  the  wages  of  men  depend 
.rather  upon  the  supply  of  laborers  and  the  demand  for 
laborers  than  upon  legislative  influence,  and  we  may 
safely  conclude  also  that  in  a  new  and  comparatively 
thinly  settled  country,  where  opportunities  for  making 
money  are  numerous,  laboring  men  will  always  com- 
mand better  wages  than  in  old  and  densely  populated 
countries  where  opportunities  for  making  money  are 
few,  the  supply  of  laborers  abundant,  and  the  demand 
comparatively  small. 

It  is  claimed  by  ultra  protectionists,  but  denied  by  all 

1  New  York  limes,  Nov.  12,  1893. 


140  THE  RAILROAD  PRESIDENT  AND  STEEL  RAILS. 

others/  that  American  workingmen  obtain  for  the  labor 
necessary  to  the  production  of  one  ton  of  steel  rails 
;^3.7'5  more  than  is  paid  in  England  for  precisely  the 
same  amount  of  work,  and  the  production  of  precisely 
the  same  amount  of  steel.  Accepting  this  statement  as 
correct  and  assuming  that  iron  ore,  coal  and  limestone, 
etc.,  are  only  just  as  plentiful  in  this  country  as  in  that, 
and  that  it  will  cost  at  least  $\  to  transport  a  ton 
of  English  made  rails  to  this  market,  it  must  follow 
that  a  duty  of  $1.1^  per  ton  upon  foreign  rails  would 
put  the  English  and  American  manufacturers  upon  an 
absolute  equality  as  competitors  for  the  American  trade. 
Suppose,  therefore,  the  railroad  president  to  whom  Gov- 
ernor McKinley  refers,  was  right  in  assuming  that  the 

1  Hon.  Tom  L.  Johnson,  a  steel  rail  manufacturer  and  mem- 
ber of  congress  from  Ohio,  said  : 

Steel  can  be  made  here  as  cheaply  as  anywhere  else  in  the 
world,  and  would  not  now  be  imported  save  in  exceptional  cases, 
even  if  there  were  no  duty,  while  the  tendency  of  invention  and 
improvement  is  in  favor  of  the  United  States  as  against  Europe. 
The  steel  made  into  rails  in  this  country  is  from  native  ore. 
What  pig  metal,  billets  and  blooms  are  imported  are  used  entirely 
in  other  iron  and  steel  manufactures. 

It  costs  less  than  $2  a  ton  to  make  steel  rails  from  blooms,  in- 
cluding straightening  and  punching.  On  today's  market  steel 
blooms  are  selling  at  less  than  $17;  steel  rails  should,  therefore, 
not  bring  over  $19.  They  did  fall  nearly  to  that  price  a  few  weeks 
ago,  duriug  a  temporary  break  in  the  steel  rail  pool.  But  that 
pool  was  quickly  reorganized,  and  the  price  of  steel  rails  was  put 
up,  and  is  now  maintained  at  $24  a  ton,  so  that  by  virtue  of  the 
duty  which  keeps  out  foreign  rails,  the  pool  is  compelling  the 
users  of  steel  rails  to  pay  them  twenty-five  per  cent,  ujore  than  a 
fair  price.  Tiiis  new  steel-rail  pool  is  composed  of  seven  inan- 
ufactiirers,  headed  by  Carnegie,  who  absolutely  control  the 
product  of  more  than  one-half  of  the  rolled  steel  produced  in  the 
United  States,  and  who  have  combined  together  to  pay  other  large 
manufacturers  heavy  annual  sums  to  close  their  works,  discharge 
their  men,  and  make  no  steel. 


THE  RAILROAD  PRESIDENT  AND  STEEL  RAILS.  141 

duty  on  steel  rails  would  be  reduced  from  $13.44  to  ;^5 
per  ton,  would  not  the  American  manufacturer  in  that 
event  still  have  ^2.25  per  ton  (over  ten  per  cent.)  ad- 
vantage of  his  foreign  rival?  While  this  reasonable 
duty  would  enable  him  to  supply  the  market  at  fair  prices, 
it  would  not  enable  him  through  a  combine,  like  that 
now  and  hitherto  existing,  to  extort  ^5  or  ;^10  per  ton 
more  for  his  product  than  it  is  worth.  The  fact  is,  we 
should  then  have  that  "  properly  adjusted  competition 
between  home  and  foreign  products "  which  Garfield 
considered  "the  best  gauge  by  which  to  regulate 
international  trade.'' 

It  will  be  observed  from  what  has  been  said  that  a 
duty  of  $  5.00  per  ton  on  steel  rails  would  provide  for 
not  only  the  difference  between  the  higher  wage  of  the 
American  and  the  lower  wage  of  the  Englishman,  but 
afford  ample  protection  to  the  American  manufacturer. 
What  was  it  then  which  deterred  this  nameless  railroad 
president  from  buying  rails,  relaying  his  track  and  giv- 
ing employment  to  thousands  of  trackmen?  Was  it 
not  the  fact  that  under  the  McKinley  law  there  is  the 
exorbitant  duty  of  ;^  13.44  per  ton  on  steel  rails,  and 
the  further  fact  that  under  this  prohibitory  tax  Ameri- 
can manufacturers  had  combined  to  extort  from  con- 
sumers $  5.00  to  $  10.00  per  ton  more  for  rails  than  they 
were  worth  ?  The  man,  probably,  did  not  propose  to 
be  robbed  under  the  McKinley  law  if  he  could  avoid 
it ;  and  to  avoid  it,  he  did  not  relay  his  track ;  did  not 
furnish  employment  to  thousands  of  trackmen  ;  did  not 
buy  rails,  and  thus  help  keep  the  millmen  and  miners 
employed.  The  truth  is,  then,  that  the  McKinley  law  was 
the  obstacle  in  his  way,  and  directly  responsible  for  the 
enforced  idleness  of  trackmen  and  millmen.  It  stood 
up  between  the  man  and  the  work  he  contemplated, 


142  THE  RAILROAD  PRESIDENT  AND  STEEL  RAILS. 

and  said,  "  You  can  relay  your  track  only  upon  one  con- 
dition, to-wit:  that  of  being  robbed  to  the  extent  of 
$5.00  per  ton  by  the  steel  men  —  $5.00  per  ton,  mind, 
on  every  ton  of  steel  rails  you  buy ! ''  Fair  trade,  not 
free  trade,  would  in  this  case  have  put  thousands  of 
men  to  work  at  honest  wages,  who,  under  the  baleful 
operation  of  the  McKinley  law,  are  left  to  idleness  and 
suffering,  and  possibly  to  beggary  and  starvation.  And 
thus  it  is  that  high  protection,  by  restricting  trade  and 
enterprise,  tends  directly  to  the  injury  of  labor  as  well 
as  capital.' 

1  Hon.  Tom  L.  Johnson,  a  member  of  congress  from  Ohio  and 
a  steel  rail  manufacturer,  while  speaking  on  the  Wilson  bill  in  the 
House  of  Representatives  (Fifty-third  Congress),  was  interrupted 
by  Mr.  Dalzell,  of  Pennsylvania,  when  the  following  colloquy 
occurred : 

"  Now  I  want  to  ask  you  a  question,"  continued  Mr.  Johnson, 
turning  to  Mr.  Dalzell.  "  Do  you  believe  in  the  existence  of  a  steel- 
rail  pool?  " 

"  I  do  not,"  replied  Mr.  Dalzell. 

"  Do  you  make  a  quibble  on  the  word  pool  ?  " 

"There  was  a  combination  to  keep  up  prices,  but  it  did  not 
keep  them  up,  and  so  it  dissolved,"  answered  INIr.  Dalzell. 

"You  deny  the  present  existence  of  a  pool?"  asked  Mr. 
Johnson. 

"Yes,  sir." 

"  AVell,  here  is  the  proof,"  said  Mr.  Johnson,  flourishing  aloft 
a  document.  "  Here  is  the  agreement  in  the  Iron  Age.  A  certain 
R.  F.  Kennedy  contracted  to  receive  25,000  tons  of  rails  at  what  I 
consider  an  exorbitant  price,  and  to  forfeit  |1,000  a  day  if  he  did 
not  take  them.  I  looked  into  the  matter  to  see  who  such  a  large 
buyer  could  be.  I  found  he  was  a  stockholder  in  the  Cambria 
works,  a  rival  concern  and  now  secretary  of  the  new  pool,  formed 
last  November.  That  pool  agreed  to  give  the  manufacturers  of 
Sparrow's  Point,  Md.,  |l,000  a  day  to  close  their  works  and  dis- 
charge their  men.  It  gives  a  concern  in  Pennsylvania  $80,000  a 
year  to  close  down.  The  old  pool  of  eight  or  nine  companies  agreed 
to  maintain  the  price  of  rails  at  $29.  One  of  the  members  secretly 
undersold  the  pool.  Carnegie  made  war  on  him,  beat  the  price 
down  to  $19,  closed  him  up,  and  then  formed  another  pool." 

"I  cannot  controvert  what  the  gentlemen  says,"  interposed 
Mr.  Dalzell.  "  But  if  such  a  pool  as  he  describes  exists,  I  depre- 
cate it  as  much  as  he." 


XXIII. 


m'kINLEY'S  old  clothes  argument  —  EFFECT  OF 
LABOR  ORGANIZATIONS  ON  WAGES  —  HAVE  THE 
GREAT  BODY  OF  LABORERS  BEEN  GETTING  AS 
MUCH  PER  CAPITA  DURING  THE  PAST  TEN  YEARS 
AS  THEY  OBTAINED  DURING  THE  TEN  YEARS  PRIOR 
TO   THE   WAR? 

"And  what  is  true  of  steel  rails  is  true  of  every  other  industry. 
How  many  men  iu  this  great  audience  have  said  to  themselves  or 
to  their  wives,  "  I  am  going  to  wear  my  old  clothes  a  little  longer." 
(Laughter  and  applause.)  I  venture  to  say  there  are  more  than  a 
thousand  men  iu  this  audience  who,  because  of  the  reduction  of 
wages,  or  of  time,  or  because  of  non-employment,  have  made  up 
their  minds  not  to  get  any  new  clothes  until  there  is  a  change. 
"  Lots  of  them,"  my  friend  says.  And  just  what  is  in  the  minds 
of  a  thousand  men  before  me  tonight  is  in  the  minds  of  a  thousand 
men  in  every  audience  like  this  all  over  the  country.  And  you 
multiply  the  thousand  people  here  with  the  thousand  people  in 
like  communities,  and  you  have  got  millions  of  people  who  do 
not  intend  to  buy  any  new  clothes  until  there  is  a  change, 
(Laughter  and  cheers.) 

What  does  that  mean?  It  means  there  is  to  be  diminished 
employment  for  the  tailors  and  the  sewing  women.  It  means 
there  is  to  be  diminished  sale*  by  the  merchant.  Because  if  you 
do  not  make  clothes  you  do  not  buy  cloth.  It  means  more  than 
that.  If  you  do  not  buy  the  cloth  the  manufacturer  will  not  make 
the  cloth.  It  means  more  than  that.  If  the  manufacturer  does 
not  make  the  cloth,  the  workingman  is  not  going  to  be  employed 
to  make  it.  And  it  affects  millions  of  other  people  all  over  this 
country." 

The  Governor's  old  clothes  argument  could  have 
been  made  as  pertinently  in  the  fall  of  1873  as  in  the 

(143) 


144  McKINLEVS  OLD  CLOTHES  ARGUMENT. 

fall  of  1893.  It  could  have  been  made  also  with  scarcely 
lessened  force  in  1876,  1877,  1878,  1884,  1890  and  at  al- 
most any  other  time  during  the  past  twenty  years,  for 
there  has  been  hardly  a  twelve  months  within  the 
period  named  when  labor  was  not  discontented  and  bit- 
terly complaining  of  lack  of  work  and  inadequate  pay. 
When  at  Pittsburg,  at  Homestead,  at  Bufifalo,  and  at 
numerous  other  points  dissatisfied  workmen  struck  for 
higher  wages,  unemployed  men  came  forward  to  take 
their  places  in  such  numbers  as  to  suggest  that  at  the 
end  of  over  thirty  years  of  high  protection  one-half  of 
our  working  population  was  unemployed,  and  hence 
*'were  wearing  their  old  clothes  and  giving  no  employ- 
ment to  tailors  and  sewing  women,"  "because  if  you  do 
not  make  clothes  you  do  not  buy  cloth  *  *  *  and 
if  you  do  not  buy  cloth  the  manufacturer  will  not  make 
the  cloth,  and  if  the  manufacturer  does  not  make  the 
cloth  the  workman  is  not  going  to  be  employed  to  make 
it,"  and  so  the  case  might  have  been  argued  by  sense- 
less repetition  to  all  eternity. 

Well  disciplined  labor  organizations  and  somewhat 
arbitrary  restrictions  with  respect  to  the  taking-on  of 
apprentices  and  sub-employes  have  enabled  a  certain 
proportion  of  American  workmen  to  obtain  employ- 
ment at  good  wages,  and  to  hold  their  positions  in  shop, 
manufactory,  or  railway  service  with  some  considerable 
degree  of  permanency.  But  while  this  is  true  of  one 
class  of  laborers  it  is  also  true  that  another  and  still 
larger  class  have  been  condemned  by  the  usages  and 
exigencies  of  the  times,  to  idleness,  to  half  work,  or  to 
such  tasks  as  were  neither  pleasant  nor  profitable.     It 


McKINLEV'S  OLD  CLOTHES  ARGUMENT.  145 

may  with  reason  be  doubted,  therefore,  whether  the 
great  body  of  laborers,  including  the  employed  and  un- 
employed, have  been  getting  during  the  past  ten  years 
as  much  per  capita  for  their  services  as  the  great  body 
of  our  workmen  obtained  during  the  decade  which  im- 
mediately preceded  the  war.  When  estimates  of  the 
rate  of  wages  paid  to  workmen  in  this  country  are  pre- 
pared by  the  statistician,  I  apprehend  no  proper  deduc- 
tions are  made  for  time  lost  by  reason  of  shutting  down 
of  mines,  mills  or  factories,  and  no  allowance  admitted 
for  the  vast  number  of  men  and  women  without  trades 
and  regular  occupations,  who  are  on  half  work  and  half 
pay,  or  wholly  unemployed  and  therefore  destitute. 
The  tramp  was  unknown  in  the  United  States  forty 
years  ago,  and  there  were  then  no  idle  workingmen  and 
women,  but  every  man  and  woman,  and  every  boy  and 
girl  of  proper  age  and  strength  was  earning  something, 
and  if  not  making  money  rapidly,  they  were  at  least  ac- 
quiring those  habits  of  thrift  and  industry  which  lead 
finally  to  independence.  The  delusion  that  it  was  the 
province  of  government  to  make  provision  for  them  by 
legislative  enactments,  and  that  they  should  look  to  it 
for  an  increase  of  wages,  or  for  special  privileges  in  any 
line,  had  not  entered  their  heads  to  undermine  their 
natural  sturdiness  of  character,  render  them  distrustful 
of  themselves  and  deprive  them  of  that  pluck  and  spirit 
of  self  reliance  so  essential  to  even  moderate  success 
in  life.' 

Those  who  find  steady  work  may  get  more  wages 

^"Protection  nourishes  dependence,  not   independence." — 
Prof.  W.  O.  Sumner 


146  McKlNLEY'S  OLD  CLOTHES  ARGUMENT. 

now  than  laborers  did  then,  but  how  has  it  been  for  the 
past  ten  years  with  the  vast  army  of  the  irregularly 
employed  ?  Would  a  reduction  of  tariff  duties  help 
them?  This  is  the  question.  Governor  McKinley  thinks 
it  would  not.  I  think  it  would.  He  thinks  it  would 
diminish  wages  and  add  to  the  ranks  of  the  unem- 
ployed. I  think  it  would  open  up  new  avenues  of 
trade,  enlarge  the  market  for  our  products,  restore  our 
mercantile  marine  to  its  old  power  and  influence, 
cheapen  the  necessaries  and  conveniences  of  life,  stim- 
ulate production,  create  additional  demands  for  labor, 
and  implant  in  the  breast  of  every  citizen  a  spirit  of 
sturdy  independence,  and  thus  make  more  strong  men 
and  women  for  the  country,  and  at  the  same  time  make 
no  less  money. 


XXIV. 


THE  OLD  MERCHANT  ARGUMENT — MEN  ON  THE  FREE 
LIST  —  IF  HIGH  TARIFFS  MAKE  HIGH  WAGES  AND 
LOW  PRICES,  WAGES  SHOULD  HAVE  BEEN  HIGHER 
AND  PRICES  LOWER  IN  1830  THAN  EVER  BEFORE 
OR   SINCE. 

"The  other  day  when  I  was  speaking  in  Northern  Ohio,  an 
old  merchant  brought  his  books  to  nay  hotel.  He  had  been  a 
merchant  from  '48  to  '62.  I  wish  everybody  might  see  those  old 
books.  They  tell  the  truth.  They  tell  the  cost  of  living  then ; 
they  tell  the  prices  of  labor  then,  and  I  copied  from  that  old  book 
—  one  of  them  —  an  entry  dated  June  30,  1858,  and  it  was  an 
account  between  the  merchant  of  the  village  and  the  carpenter  of 
the  village. 

"  The  carpenter  was  working  for  the  merchant,  and  on  June 
30,  '58,  the  merchant  credited  him  on  his  day  book  with  one  day's 
work  at  $1.50  a  day,  and  on  the  same  day  the  carpenter  bought 
the  following  four  items,  which  are  charged  on  the  merchant's 
book,  with  the  prices  at  the  time,  and  these  were  the  items:  Nine 
yards  of  calico  at  12j  cents  a  yard,  $1.13;  nine  yards  of  lawn  at 
12^  cents,  $1.13;  eight  pounds  of  coffee  sugar  at  12|  cents  a  pound, 
$  1.00 ;  and  twelve  pounds  of  cut  nails  at  7  cents  a  pound,  84  cents. 
The  total  for  these  four  items  in  1858  was  $4.10.  The  wage 
received  by  the  carpenter  was  $1.50  a  day.  He  gave  to  the  mer- 
chant his  one  day's  work,  bought  those  four  items,  and  owed  the 
merchant  $2.60  in  cash. 

"  Now  let's  take  the  carpenter  of  1892.  The  pay  of  the  car- 
penter in  1892  was  from  $2.50  to  $2.75  a  day  in  Ohio.  I  take  the 
lowest.  $2.50.  Now  charge  him  with  the  same  four  items  that 
were  charged  the  carpenter  in  '58,  with  the  prices  prevailing  last 
year,  and  let  us  see  the  state  of  the  account.  One  day's  labor, 
$2.50  a  day ;  nine  yards  calico  in  '92, 5  cents  a  yard,  45  cents ;  nine 

(147) 


148  THE  OLD  MERCHANT  ARGUMENT. 

yards  of  lawn  8  cents  a  yard,  72  cents ;  8  pounds  of  coffee  sugar  at 
6  cents  a  pound,  48  cents  (  and  6  cents,  I  am  told,  is  too  high,  but 
call  it  6 ) ;  twelve  pounds  of  cut  nails  at  3  cents  a  pound,  36  cents. 
The  total  of  these  four  items  in  '92  is  §2.01.  The  carpenter  in  1892 
gave  his  one  day's  work  to  the  merchant,  bought  those  four  items, 
paid  for  them,  and  out  of  that  day's  work  had  49  cents  in  cash  in 
his  pocket-book,     ( Loud  applause  and  cheers ). 

"The  carpenter  in  1858  gave  the  same  number  of  hours,  the 
same  skill  and  the  same  toil ;  bought  the  same  four  items,  and 
owed  the  merchant  $2.60  in  cash,  or  nearly  two  days'  additional 
work.  Which  do  you  like  best— 1892  or  1858  ?  ( A  voice,  "  '92." ) 
Well,  then,  vote  that  way  on  next  Tuesday." 

The  account  book  of  the  old  merchant  was  evidently 
regarded  by  Governor  McKinley  as  conclusive  evidence 
that  the  high  protective  system  elevates  the  price  of 
men's  labor  and  depresses  the  price  of  everything  else. 
This  was  proving  rather  too  much  to  suit  the  wool- 
grower,  the  iron  monger  and  the  woolen  goods  manu- 
facturer, but  as  the  Governor  had  many  times  before 
proved  just  as  conclusively  to  them  that  either  a  low 
tariff  or  no  tariff  would  reduce  the  price  of  their  prod- 
ucts to  a  ruinous  extent,  they  doubtless  listened  to  him 
without  alarm  and  applauded  with  their  usual  vigor. 
The  laboring  men  in  his  audience  were  the  only  per- 
sons at  all  likely  to  be  deceived.     These  probably  were 
too  much  interested  in  the  Governor's  speech  to  medi- 
tate on  the  fact  that  men  —  laboring  men,  as  well  as  all 
other  men,  are  on  the  free  list.      There  is  no  duty  on 
foreign  laborers ;  they  come  to  the  United  States  when 
they  please,  and  compete  with  the  naturalized  citizen 
and  the  native  born  on  equal  terms  in  all  the  vocations 
of  life.     They  sometimes  stand  at  the  entrance  way  to 
employment  with  gun  or  club  to  drive  away  a  descend- 


THE  OLD  MERCHANT  ARGUMENT.  •  149 

ant  of  a  soldier  of  the  Revolution  who  presumes  to  seek 
for  work  and  bread  in  the  land  of  his  fathers !  They 
bring  to  our  very  doors  that  competition  which  seems 
so  formidable  and  repulsive  to  our  high  tariff  orators 
when  seen  three  thousand  miles  away.  It  may 
be  that  their  products  are  better  when  made  here  than 
when  made  abroad.  It  may  be  also  that  the  advantages 
which  they  afford  us  in  a  social  way  are  more  than  a 
full  compensation  for  the  injuries  they  inflict  by  their 
eager  competition.  They  help,  of  course,  to  eat,  wear  and 
use  our  products,  but  they  help  to  make  them  also,  and 
to  hasten  the  day  when  the  population  of  the  United 
States  shall  be  six  hundred  millions  and  our  children, 
like  the  children  of  densely  populated  sections  of  the 
old  world,  be  compelled  to  wage  a  life-long  warfare 
against  starvation.  This  suggests  the  only  competition 
American  laborers  have  to  fear.  A  tariff  or  tax  upon 
foreign  goods  never  increased  any  man's  wages  to  the 
extent  of  a  farthing.  There  is  but  one  way  to  increase 
the  price  of  labor  by  congressional  enactment,  and  that 
is  by  a  law  limiting  the  supply  of  laborers.'     This  would 

1  "  This  iucreasing  readiness  to  emigrate  must  exert  an  equal- 
izing influence  on  wages,  and  must  cause  the  difference  in  wages 
in  the  two  countries,  between  which  the  migration  takes  place, 
steadily  to  diminish."— ^en?-^  Faucett. 

Pittsburgh,  Pa.,  January  27.— A  wave  of  anarchy,  in  whose 
train  followed  bloodshed,  arson  and  the  destruction  of  property, 
passed  over  the  Mansfield  coal  region  today.  It  began  at  dawn 
and  at  dusk  it  was  estimated  that  $100,000  worth  of  property  had 
been  destroyed.  Made  wild  by  fancied  grievances  and  liquor,  a 
mob  of  several  hundred  foreigners,  Hungarians,  Slavs.  Italians 
and  Frenchmen,  swept  over  the  countiy  surrounding  Mansfield 
and  through  the  valleys  of  Tom's  and  Painter's  runs.  They 
attacked  mine  owners,  miners  and  the  few  scattered  deputy 
sheriffs,  burned  tipples,  wrecked  cars  and  destroyed  railroad 
property.—  Ohio  State  Journal,  Jan.  28,  1894. 


f50  THE  OLD  MERCHANT  ARGUMENT. 

increase  the  price  of  labor  just  as  a  high  tariflf  increases 
the  price  of  goods. 

The  subject  I  intended  to  talk  about,  however,  is  the 
account  book  of  the  old  merchant.  No  one  could  dis- 
pute the  correctness  of  its  divers  and  sundry  entries. 
The  merchant,  and  the  carpenter  with  whom  he  dealt 
were  vouched  for  by  Governor  McKinley  as  honest  men. 
In  this  book,  therefore,  was  proof  conclusive  that  low 
tariffs  make  low  wages,  and  high  prices,  while  high 
tariffs  make  low  prices  and  high  wages.  It  is  somewhat 
remarkable  that  such  should  be  the  case  when  the  wages 
of  labor  and  the  product  of  labor  are  so  intimately  con- 
nected. It  would  indeed  seem  to  the  ordinary  observer 
that  things  made  by  a  day's  work  when  wages  are  only 
one  dollar  a  day  should  cost  a  little  less  than  when 
made  by  labor  for  which  four  dollars  a  day  are  paid,  and 
this  I  understand  from  Governor  McKinley  is  the  case 
in  Europe.  But  high  tariffs,  and  especially  the  McKin- 
ley bill,  make  products  exorbitantly  high  for  the  seller  in 
America,  and  exceedingly  low  for  the  buyer,  and  thus 
satisfy  both  parties  to  a  bargain.  Just  how  the  tariff" 
accomplishes  the  marvelous  feats  attributed  to  it,  in  this 
country,  while  tariffs  operate  in  an  exactly  opposite 
way  in  other  countries,  is  only  known  to  the  initiated, 
and  never  understood  by  the  common  run  of  men. 
The  book  of  the  old  merchant,  however,  supplemented 
by  Governor  McKinley's  logic,  establishes  the  fact  that 
high  tariffs  in  America  are  so  cunningly  and  skillfully 
devised  as  to  bring  about  the  precise  results  desired  by 
each  individual  person  of  a  population  numbering  sixty- 
five  millions,  and  this  being  the  case  the  book  was  a 


THE  OLD  MER CHANT  ARG UMENT.  1 51 

lucky  find  for  the  Governor,  for  he  had  about  exhausted 
the  invaluable  but  irrelevant  statistics  of  the  United 
States  census  reports,  and  was  sorely  in  need  of  some- 
thing to  give  an  appearance  of  strength;  if  not  the  sub- 
stance thereof,  to  his  eloquent  utterances.  The  book, 
therefore,  was  a  timely  and  fortunate  acquisition.  It 
indicated  the  prices  of  labor  and  products  under  the 
low  tariflf  of  1857  —  a  tariflf  enacted  by  the  aid  of  a  Re- 
publican House  of  Representatives — and  the  Governor 
and  his  audience  were  familiar  with  the  prices  of  labor 
and  products  under  the  high  tarifif  of  recent  years,  so 
that  the  introduction  of  the  old  book  ended  all  argu- 
ment by  proving  beyond  a  peradventure  that  the  higher 
the  tariff  waSy  the  lower  the  prices  of  products  and  the 
higher  wages  would  be. 

The  foregoing  proposition  being  now  forever  estab- 
lished, permit  me  to  present  a  paragraph  from  the  Gov- 
ernor's speech  at  Niles,  Ohio,  in  1891,  and  then  call 
attention  to  a  startling  fact  never  hitherto  mentioned 
by  political  economists. 

"In  1820,  the  average  rate  (tariff  rate)  was  22.29;  in  1830, 
46.31  ;  in  1840,  15.45;  in  1850,  23.16;  in  1860, 15.67 ;  in  1870,  42.23  ; 
in  1880,  29.7 ;  in  1890,  29.12.  These  are  the  average  rates  upon  all 
articles  both  free  and  dutiable." 

In  the  year  1830,  therefore,  according  to  the  Gover- 
nor's most  admirable  argument,  wages  must  have  been 
higher  than  at  any  other  time  in  the  history  of  our 
country,  and  cut  nails  must  have  trotted  around  after 
carpenters,  begging  to  be  accepted  and  hit  on  the  head 
for  nothing.  That  year,  to-wit,  the  year  A.  D.  1830, 
must,  if  there  is  any  confidence  to  be  placed  in  strong 


152  THE  OLD  MERCHANT  ARGUMENT. 

argument,  re-inforced  by  the  account  book  of  a  truthful 
merchant,  who  had  dealings  with  an  honest  carpenter, 
have  been  the  most  prosperous  known  to  American  his- 
tory. I  assume  from  the  Governor's  unerring  logic  and 
not  from  a  knowledge  of  the  prices  current  at  the  time, 
that  nine  yards  of  calico  at  two  cents  a  yard  then  cost 
eighteen  cents ;  nine  yards  of  lawn  three  cents  per  yard, 
twenty-seven  cents ;  eight  pounds  of  cofifee  sugar  two 
and  one-half  cents  a  pound  (and  two  and  one-half  cents 
a  pound  I  am  told  is  too  high,  but  call  it  two  and  one- 
half),  twenty  cents;  twelve  pounds  of  cut  nails,  0; 
total  for  the  four  items  sixty-five  cents.  Now  the  wages 
paid  to  the  carpenter  could  not,  according  to  the  tariff 
rates  on  imported  goods,  have  been  less  than  four  dol- 
lars a  day  and  board.  It  follows,  therefore,  that  out  of 
his  day's  wages  the  carpenter  was  enabled  to  pay  the 
merchant's  bill  and  have  enough  left  to  buy  a  cow.  All 
this  may  seem  a  little  improbable,  but  the  reader  should 
bear  in  mind  that  in  that  blessed  year  the  country  had 
the  highest  tariff  on  record ! 


XXV. 


m'kinley's  criticism  of  gov.  m'corkle  —  Cleve- 
land's POSITION  ON  THE  TARIFF  —  INCONSIST- 
ENCY IN  GOV.  m'corkle,  no  WORSE  THAN  INCON- 
SISTENCY IN  GOV.  M'KINLEY  —  THE  OLD  OHIO 
REPUBLICAN  PLATFORMS  SUGGEST  THE  KIND  OP 
TARIFF   WHICH   SHOULD   BE   MAINTAINED. 

"  We  are  in  a  remarkable  condition  in  this  country  to-day. 
There  never  was  just  such  a  situation.  Democrats  are  petitioning 
congress  not  to  disturb  the  tariff  (laughter),  after  having  voted 
the  party  in  power  to  disturb  it.  That  is  all  very  well,  but  peti- 
tions don't  count  in  this  country— it's  ballots.  (Applause.)  The 
ballot  expresses  the  free  man's  will,  and  that  alone  is  conqueror 
in  a  popular  government  like  ours.  Governor  McCorkle,  of  West 
Virginia,  a  Democrat,  elected  on  the  same  ticket  with  Mr.  Cleve- 
land, elected  on  a  free  trade  platform,  went  to  the  Committee  of 
Ways  and  Means  the  other  day,  and  begged  that  committee  not 
to  disturb  the  tariff  on  coal."    [Laughter.] 

Governor  McKinley  should  not  deliberately  mis- 
state the  position  of  his  political  adversaries,  for  in  doing 
so  he  fails  to  maintain  the  high  standing,  as  a  debater, 
accorded  to  him  by  the  New  York  Tribune  in  its  issue 
of  October  11,  1893.  That  pronounced  high  tariff  organ 
affirms  that  "  His  (Governor  McKinley's)  speeches  are 
conspicuous  for  fairness  and  sincerity.  He  strives  to 
bring  out  clearly  what  is  essential  to  the  argument  on 
each  side,  and  then  to  adjust  the  scales  with  an  even 
hand  and  an  unprejudiced  eye.  It  is  this  habit  of  mind 
which  imparts  educational  value  to  his  speeches." 

(153) 


154  INCONSISTENCV. 

Now  the  truth  is  that  Governor  McCorkle  and 
President  Cleveland  were  not  elected  on  a  free  trade 
platform,  and  when  Governor  McKinley  said  they  were 
he  was  not  only  not  making  himself  "conspicuous  for 
fairness  and  sincerity,"  but  for  another  trait  which  has 
never  hitherto  been  counted  among  the  virtues.  The 
convention  which  nominated  Mr.  Cleveland  declared  in 
favor  of  a  tarifif  for  revenue  only ;  but  it  was  as  well  un- 
derstood then  as  now  that  this  resolution  did  not  express 
his  views  nor  those  of  any  considerable  number  of  his 
supporters.  Mr.  Cleveland's  tarifif  message  during  his 
first  term  defined  his  position  on  the  tarifif  question  with 
admirable  consistency  and  force,  and  this  to  all  intents 
and  purposes  was  the  platform  upon  which  he  ran  for  a 
second  term.     He  then  said: 

"  In  a  readjustment  of  our  tarifif  the  interests  of 
American  labor  engaged  in  manufacture  should  be  care- 
fully considered.  *  *  *  Relief  from  the  hardships 
and  dangers  of  our  present  tarifif  laws  should  be  de- 
vised with  especial  precaution  against  imperiling  the 
existence  of  our  manufacturing  interests."  President 
Cleveland  today  occupies  the  precise  position  on  this 
subject  held  by  President  Garfield  and  a  million 
intelligent  Republicans;  the  precise  position,  in  fact, 
but  recently  occupied  by  the  Ohio  State  Journal,  the 
Cincinnati  Commercial  and  all  the  more  prominent  and 
ably  conducted  Republican  newspapers  of  Ohio.  In 
brief,  President  Cleveland's  views  are  identically  those 
embodied  in  the  Republican  State  platforms  of  Ohio 
certainly  for  ten,  and    probably  for  twenty  successive 


INCONSISTENCY.  155 

years.^  To  say,  therefore,  that  he  is  a  free  trader  is  not 
only  misleading  but  a  wilful  perversion  of  the  truth. 
What  Governor  McCorkle  has  been,  or  is  now,  I  shall 
not  undertake  to  say ;  I  only  know  he  was  not  elected 
on  a  free  trade  platform,  because  there  was  no  free 
trade  platform  in  any  State  of  the  Union  for  a  governor 
to   be   elected  upon.^     Governor  McCorkle,  therefore, 

^  "  We  favor  a  tariff  for  revenue  limited  to  theneeessities  of  gov- 
ernment, economically  administered,  and  so  adjusted  in  its  applica- 
tion as  to  prevent  unequal  burdens,  encourage  productive  indus- 
tries at  home,  afford  just  compensation  to  labor,  but  not  to  create 
or  foster  monopoly." — Ohio  Bepublican  Platform. 

2  The  Ohio  State  Journal  has,  for  thirty-seven  years,  been  the 
recognized  organ  of  the  Republicans  of  Ohio.  It  has  from  time 
to  time  given  publicity  to  very  decided  opinions  on  the  subject 
under  consideration.  It  might  be  well,  therefore,  for  gentlemen 
of  the  McKinley  school  to  refresh  their  memories  somewhat  by 
reference  to  old  files  of  this  valuable  paper. 

I  clip  the  following  from  the  JournaVs  editorial  column  of 
June  17,  1869: 

"  The  only  kind  of  a  tariff  we  believe  in  is  a  tariff  for  revenue, 
which  is  only  another  name  for  equitable  taxation.  The  differ- 
ence in  the  principles  upon  which  are  based  revenue  tariff  and  a 
protective  tariff  is  radical  and  fundamental.  The  one  system  is 
restriction,  prohibition,  monopoly,  for  restriction's,  prohibition's 
and  monopoly's  sake,  the  other  is  the  imposing  of  a  just  and 
equitable  tax  upon  goods  entering  the  country  ■■  *  for  the  sake 
of  revenue." 

Again,  "a  protective  tariff — or  to  give  words  their  proper 
meaning,  a  prohibitory  tariff  —  robs  the  many  to  bestow  subsidies 
which  are  doubtful  benefits  upon  the  few." 

March  18,  1870.  "Instead  of  legislating  for  this  interest  and 
for  that  interest,  consuming  months  in  inquiring  what  this  class 
and  that  class  wants,  and  being  dogged  about  the  streets  as 
Schenck  complains,  by  Pig  Iron,  and  Beeswax,  and  Hair  Pins  and 
Saleratus,  the  simple  inquiry  is,  what  do  the  interests  of  a  major- 
ity of  the  tax-payers  require  ?  Less  than  five  millions  of  our  pop- 
ulation of  forty  millions  are  engaged  in  the  manufacturing  busi- 
ness; would  it  not  be  sensible  to  legislate  in  the  interest  of  the 
thirty-five  millions?" 

April  26,  1870.  "  When  we  speak  of  a  protective  tariff  man 
we  mean  what  we  say,  i.  e.,  a  man  who  supposes  protection  to  be 
the  object  of  a  tariff.  When  we  speak  of  a  revenue  tariff  man  we 
mean  a  person  who  believes  that  revenue  is  the projyer  object  of  a 
tariff.  When  we  speak  of  a  free  trader  we  mean  a  man  who  does 
not  believe  in  any  tariff  of  any  description." 


156  INCONSISTENCy. 

might  consistently  enough  have  asked  that  in  the  dis- 
tribution of  special  privileges  and  legislative  favors  his 
own  State  should  not  be  overlooked.  And  then,  again, 
Governor  McCorkle  might  have  been  inconsistent ;  the 
temptations  to  inconsistency  in  speech  and  act  are,  in 
these  latter  days,  exceedingly  plentiful.  It  has  been 
my  task  for  some  little  time  to  point  out  the  inconsis- 
tencies of  a  governor  of  Ohio,  and  I  have  had  reason 
to  conclude  that  inconsistency  is  not  a  more  excep- 
tional trait  in  governors  than  in  common  men.  It 
may  be,  therefore,  that  Governor  McCorkle,  after  ex- 
horting the  brethren  to  be  honest  concluded  that  so 
long  as  men  were  licensed  to  rob,  the  good  people  of 
West  Virginia  should  not  be  denied  the  privilege  of  rob- 
bing.^ It  was  perhaps  an  error  on  his  part,  but  even  if 
he  knew  it  to  be  an  error,  and  frankly  admitted  it,  he 
was  no  more  culpable  certainly  than  the  plausible  gen- 
tleman who  professes  to  believe  that  stealing  is  right  on 
principle,  and  hence  proceeds  to  appropriate  to  his  own 
use,  and  that  of  his  friends,  everything  within  reach. 
I  have  no  interest,  however,  in  Governor  McCorkle, 
and  have  referred  to  him  simply  to  show  that  neither 
his  words  nor  his  acts  have  any  relevancy  whatever  to 
the  merits  of  the  question  Governor  McKinley  was 
attempting  to  discuss. 

^  "Much  was  said  about  broad  principles,  but  all  referred  to 
the  notion  that  by  robbing  all  for  the  benefit  of  the  few  it  was 
possible  in  some  way,  which  never  was  explained,  to  gain  great 
benefit  to  all."  —  Prof.  W.  O.  Sumner. 


APPENDIX. 


STATEMENT    OF    THE     WAGE     WORKERS     IN     THE     POTTERIES    OF 
TRENTON,  NEW  JERSEY,  FEB'Y.,  1894. 

"(Notwithstanding  the  fact  that  the  tariff  on  pottery  has  been 
increased  by  every  tariff  bill  passed  since  the  industry  was  started 
the  wages  of  the  workman  have  been  decreased.  *    In  1874 

the  manufacturers  cut  down  wages.  ■■     In  1885  soon  after  the 

passage  of  the  Act  of  1883  increasing  duties,  another  strike  against 
reduction  in  wages  lasted  from  January  until  March.  *    In 

Dec,  1890,  after  the  McKinley  law  was  enacted  the  sanitary  ware 
combination  forced  another  strike  by  a  cut  of  fi'om  10  to  40  per 

cent."  mBBBtitm 

In  1874  the  workingmen  of  Trenton  signed  the  following  peti- 
tion :  "  We  the  operative  potters  of  the  city  of  Trenton,  being 
convinced  by  experience  that  a  high  rate  of  duty  on  crockery  ware 
yields  no  benefit  financially  to  the  workingman,  and  is  inimical 
to  his  interest  in  increasing  the  price  of  living  generally,  respect- 
fully petition  your  honorable  body  (Congress)  for  such  a  revision 
of  the  tariff  as  will  reduce  the  rates  on  crockery  ware  to  a  revenue 
basis.  *  ■■  A  tariff  levied  in  the  name  of  protection  to  Ameri- 
can industries  is  a  false  pretense  and  a  delusion.  In  its  practical 
operation  it  is  a  monoijoly  for  the  benefit  of  the  few  at  the  expense 
of  the  many."— iV^ew  York  World,  Feb'y.  19,  1894. 

On  page  252,  volume  20,  of  the  tenth  census  report  the  reader 
will  find  that  the  wages  paid  for  mining  ore  in  >.orth  Staflord- 
shire  district,  England,  were  in  1880  as  follows:  (,'olliers,  97  cents 
per  day  of  nine  hours'  length  ;  tunnellers  and  shaftsmen,  85  to  97 
cents  per  day  of  similar  length.  Wages  paid  at  the  Shelby  iron 
works,  Alabama  (U.  S.)  to  miners  and  laborers  the  same  year,  90 
cents  per  day  of  ten  hours. —  Ohio  State  Journal,  Feb'y.,  1887. 

The  above  would  indicate  that  protected  industries  in  the 
United  States  do  not  pay  more  for  labor  than  they  are  obliged  to 

pay 

This  paper  printed  a  list  of  over  500  strikes  against  reduced 
wages  in  protected  industries  in  the  year  after  the  McKinley  bill 
became  a  law.— iVew  York  World,  Feb'y.  13,  1894. 

EFFECT  OF   COMBINES  AND  POOLS  ON   CERTAIN  LOCAL 
INDUSTRIES. 

1.  The  starch  factory  of  Columbus  was  bought  by  the  great 
starch  combine  at  a  high  price  for  the  purpose  of  destroying 
competition  ;  and  to  limit  production  the  factory  was  closed  and 
its  employes  discharged. 

2.  The  Columbus  Steel  Mill,  after  an  expenditure  of  $500,000, 
was  compelled  to  shut  down  because  it  could  neither  aftord  to  pay 
the  exorbitant  duty  on  foreign  steel  blooms  or  ingots,  nor  obtain 
at  a  fair  price  blooms  or  ingots  manufactured  in  this  country. 


Go  to  any  importer  and  he  will  show  you  his  bill  of  goods 
bought  abroad  at  the  market  price  in  the  place  where  purchased, 
aud  then  he  will  show  you  his  custom-house  receipts  for  duty 
paid,  and  his  freight  receipts  for  treight  paid;  aud  you  will  find 
that  all  these  items,  together  with  interest  and  profits,  enter  into 
aud  make  the  price  which  the  consumer  pays.  JVIr.  Maize,  the 
collector  of  customs  at  Columbus,  can  from  his  books  also  satisfy 
you  that  the  importer  not  the  exporter  pays  the  duty  or  tax  ou 
foreigu  goods. 

The  Republican  party  in  its  national  platform  of  1892  affirmed 
that  tariff'duties  should  be  "equal  to  the  difference  between  wages 
abroad  and  at  home;"  that  is  that  the  duties  should  be  equal  to 
the  ilittercnce  in  the  labor  cost  of  products. 

The  following  table,  ^  showing  the  amount  paid  for  labor  in  the 
production  of  one  dollar's  worth  of  goods,  is  taken  from  the  report 
of  the  Bureau  of  Labor  Statistics  of  Connecticut.  The  statistics — 
prepared  by  a  Republican — relate  to  the  year  1891,  and  were  com- 
piled from' returns  made  by  the  proprietors  of  624  Connecticut 
factories : 

Wages  cost.  Wages  cost. 

Products.  per  cent.  Products.  per  cent. 

Brass  goods 21.76  Machinery 43.80 

Carriages  36.08  Paper  boxes 35.35 

Clocks    42.80  Paper 20.46 

Corsets 29.70  Rubber  goods 26.10 

Cotton  goods 25.18  Shoes 30.48 

Cutlery 51.57  Silver-plated  ware 27.82 

Hardware 39.61  Wire  goods 21.21 

Hats 36.50  Woodenware 31 .55 

Iron  foundry  products.  38.60  Woolen  goods 21.60 

Knit  goods 28.61 

If  it  is  assumed  that  wages  are  100  per  cent,  higher  in  this 
country  than  iu  other  manufacturing  countries,  and  that  foreign 
goods  can  be  brought  to  the  United  States  without  cost  for  trans- 
portation it  would  follow  that  the  following  tariff  rates  on  articles 
in  the  above  list  would  be  "  ecjual  to  the  diftereuce  between  wages 
abroad  and  at  home,"  and  hence  a  comj^lete  fulfillment  of  the  re- 
quirements of  the  Republican  national  platform : 

Brass  goods 10.88  Machinery 21.90 

Carriages  1 8.04  Paper  boxes     17.68 

Clocks 21.40  Paper 10.23 

Corsets 14.85  Rubber  goods 13.05 

Cotton  goods 12.59  Shoes 15.24 

Cutlery  25.78  Silver  plated  ware 13.91 

Hardware 19.80  Wire  goods 10.61 

Hats 18.25  Woodenware 15.78 

Iron  foundry  products.  19.00  Woolen  goods 10.80 

Knit  goods 14.30 

Under  the  McKinley  law  the  tariflf  rates  on  woolen  goods 


1.     Clipped  from  the  New  York  Times. 

ii 


range  from  60  to  150  per  cent.;  on  cotton  goods  from  35  to  66  ;  on 
cutlery  from  50  to  150.  When  in  fact  "  the  difference  between  wages 
abroad  and  at  home"  cannot  exceed  11  per  cent,  on  woolens;  13 
per  cent,  on  cottons,  and  26  per  cent  on  cutlery.  Substantially  the 
same  criticism  may  be  made  with  respect  to  other  articles  named 
in  the  above  table. 

There  were  good  reasons  why  Mr.  McKinley  could  not  be  per- 
mitted to  open  the  Pandora  bos  of  tariff  taxes  in  Philadelphia 
and  before  the  members  of  the  Manufacturers'  Club.  They  had 
contracted  by  purchase  for  increased  taxes  upon  the  people,  and 
McKinley,  as  Chairman  of  Ways  and  Means,  was  made  the  audi- 
tor to  apiiortion  the  tariff-tax  raiment  of  the  people  among  its 
purchasers.  [Laughter.]  President  Dolan  lit  up  his  exquisite 
college-professor  face  with  its  most  fascinating  smile  as  he  planked 
down  his  $10,000  to  help  Quay  get  an  honest  election  in  New 
York  in  1888  [Shouts  of  laughter],  and  he  made  his  fellow  woolen 
manufacturers  follow  his  example.  He  promptly  appeared  before 
Auditor  McKinley  when  sitting  for  distribution  of  the  plunder, 
and  was  awarded  the  increased  taxes  on  woolens  he  demanded. 
He  had  paid  spot  cash  for  it,  and  McKinley,  like  an  honest  Audi- 
tor, gave  him  what  he  had  paid  for.  [Laughter.]  Mr.  Dobson 
cheerfully  gave  his  $10,000  to  help  Quay  purify  elections,  and  he 
and  his  fellow  carpet  contributors  pleaded  their  contract  before 
Auditor  McKinley  and  were  awarded  their  claim.  [Laughter.] 
The  Harrisons,  the  Spreckels  and  the  Knights  chipped  in  with  their 
thousands  and  Auditor  McKinley  gave  them  free  raw  sugar  and 
continued  the  tax  on  refined  sugar.  All  have  since  sold  out  to  the 
Sugar  Trust  because  Auditor  McKinley  protected  it,  and  Spreckels 
waved  us  a  grateful  farewell  as  he  shook  the  dust  of  Philadelphia 
from  his  feet  and  hastened  toward  the  setting  sun  with  three  mil- 
lions or  so  as  his  award. — Col.  A.  K.  McClure,  Sept.  26,  1892. 

If  Governor  McKinley  will  spend  an  hour  with  me  on  the 
new  Times  building  now  in  course  of  erection  on  Sansom  street 
above  Eighth  I  will  introduce  him  to  the  skilled  and  unskilled 
labor  employed  on  it,  and  Allen  Rorke,  the  builder,  who  is  yet 
green  with  his  laurels  as  Chairman  of  the  Republican  city  com- 
mittee, will  exhibit  him  the  pay  list  of  the  non-protected  but 
heavily-taxed  labor  employed.  Here  are  the  daily  wages  and 
hours  of  labor  of  the  non-protected  workmen  engaged  on  that 
structure : 

Hours.  Daily  wag^s. 

Stone-masons 9  $3.25  to  $3  75 

Bricklayers 9  3.75  to  4.50 

Carpenters •••• 9  3.00 

Plumbers 9  3.25  to  3.50 

Plasterers 8  3.00  to  3.50 

Stone-cutters 9  3.50  to  4.00 

Roofers 9  3.00  to  3.25 

Painters 9  3.00  to  3.25 

Hod-carriers 9  2.75  to  3.00 

Riggers 9  2.75  to  3.25 

Laborers 9  2.00  to  2.25 

iii 


After  having  asfortained  the  wages  paid  to  these  non-jirot^cted 
and  highly  taxed  workmen  1  will  take  him  to  the  composing  roona 
of  The  TniKs,  where  every  expert  printer  can  earn  $4  per  day  of 
eight  houns,  with  steady  Mork  from  January  to  January,  and 
special  experts  can  earn  as  high  as  $5  per  day. 

*  S:-  «  vf-  •:•:•  « 

Now  let  us  look  at  the  protected  industries  of  Philadelphia. 
Of  these  the  woolen  industry  is  one  of  the  most  important,  and  if 
Governor  IMcKinley  will  turn  to  Superintendent  Porter's  census 
bulletin  No.  I3!»,  he  will  find  that  the  following  average  wages  are 
paid  in  the  woolen  industry  in  the  States  named  : 

For  the  Year.  Per  Week. 

Alabama $159  $3.06 

Arkansas 201  3.86 

Ohio ..  242  4.65 

Virginia 270  5.20 

New  Jersey 334  6.42 

New  York 336  6.46 

Pennsylvania 355  6.83 

Massachusetts 375  7,21 

Oregon 436  8.40 

It  will  be  seen  that  the  average  wages  of  labor  in  the  woolen 
industry  of  Pennsylvania  is  $^355  per  year  or  $6.83  per  week  or 
about  $1.15  per  day. — McClure. 

Mr.  Blaine  told  the  truth  as  he  was  struggling  for  months  to 
force  McKinley  to  accept  reciprocity  as  a  feature  of  his  tariflf,  when 
he  declared  in  an  open  letter  to  Senator  Frye,  that  the  McKinley 
tariff  would  not  furnish  the  farmer  a  market  for  a  single  addi- 
tional barrel  of  i^ork  or  sack  of  flour. — Mo  Clure. 

By  some  miscalculation  in  the  figuring,  wool  has  gone  down 
instead  of  up,  but  the  manufacturer  gets  twenty-three  cents  more 
per  pound  for  his  cloth,  and  buys  Ohio  wool  four  cents  lower  in- 
stead of  four  cents  higher  per  pound.  It  would  seem  that,  while 
Judge  Lawrence  and  Mr.  Harpster  were  discussing  some  decision 
of  the  umpire,  instead  of  playing  ball,  Mr.  William  Whitman, 
Treasurer  and  General  Manager  of  the  Woolen  Manufacturers' 
Association,  made  a  home  run  and  won  the  game.  The  public 
prints  inform  us  that  Mr.  Whitman,  on  the  29th  of  March,  1890, 
before  the  new  tariff  law  was  passed,  in  an  address  to  the  stock- 
holders of  the  Arlington  Mills,  told  them  that  he  had  been  their 
treasurer  for  a  period  of  twenty  years,  and  that  during  that  time 
the  average  earnings  had  been  28.8  per  cent,  on  their  capital,  and 
that  the  earnings  of  last  year  were  three  and  a  half  times  more 
than  that  of  the  previous  year.  Notwithstanding  thislvery  great 
prosperity  Congress  on  the  1st  of  October,  1890,  increased  the 
duties  on  woolen  goods  instead  of  reducing  them.  It  will  be  very 
late  in  the  evening  of  a  very  chilly  day  when  Mr.  Whitman  gets 
left  on  the  woolen  schedule  of  a  tariff  bill. — Hon.  B.  Q.  Mills, 
Mansfield,  1891. 
iv 


WHO    PAYS    THE    TAX? 


GOVERNOR 


Mckinley  says 
eigner  pays  it. 


THE    FOR- 


GOVERNOR  Mckinley  says  the  amer 

CAN  CONSUMER  PAYS  IT. 

"  We  tell  every  man  in  America  who  wani 
Scotland's  pig  iron,  if  he  thinks  it  is  an 
better  and  does  not  want  the  American  pi 
iron  —  we  tell  him  if  he  must  have  the  Scotcl 
'  You  must  pay  for  the  privilege,'  and  in  th; 
way  we  maintain  that  great  industry"  (^ 
188;  Oct.  29,  1885). 

"  Under  this  law  [the  McKinley  bill]  tl 
[United  States]  Government  cannot  u 
abroad  and  buy  what  it  can  get  at  hom. 
without  paying  duty.  The  result  will  b 
that  the  Government  hereafter  will  buy  mor 
at  home  and  less  abroad — and  it  ought  t( 
[Applause]  "  (p.  511;  April  10,  1891). 


"  What,  then  is  the  tariff?  The  tariff  .  . 
is  a  tax  put  upon  goods  made  outside  of  the 
United  States  and  brought  into  the  United 
States  for  sale  and  consumption.  ...  If 
a  man  comes  to  our  cities  and  wants  to  sell 
goods  to  our  people  on  the  street,  .  .  . 
we  say  to  him,  '  Sir,  you  must  pay  so  much 
into  the  city  treasury  for  the  privilege  of 
selling  goods  to  our  people  here.'  Now, 
why  do  we  do  that?  We  do  it  to  protect 
our  own  merchants.  Just  so  our  Govern- 
ment says  to  the  countries  of  the  Old  World, 
.  .  .  '  If  you  want  to  come  in  and  sell  to 
our  people,  and  make  money  from  our  peo- 
ple, you  must  pay  something  for  the  privi- 
lege of  doing  it.  .'  Now,  that  is  the 
tariff"  (pp.  185,  186;  Oct.  29,  1885). 

:;;  *  j::  :;:  *  * 

"They  say  'the  tariff  is  a  tax.'  That  is 
a  captivating  Cry.  So  it  is  a  tax;  but 
whether  it  is  burdensome  upon  the  Ameri- 
can people  depends  upon  who  pays  it.  If 
we  pay  it,  why  should  the  foreigners  object? 
Why  all  these  objections  in  England,  France, 
Germany,  Canada,  and  Australia  against 
the  tariff  law  of  1890,  if  the  American  con- 
sumer bears  the  burdens,  and  if  the  tariff 
is  only  added  to  the  foreign  cost  which  the 
American  consumer  pays?  Jf  they  pay  it, 
then  we  do  not  pay  it"  (p.  579;  May  17, 
1892). 

We  should  not  stop  here  if  our  object  were  to  confute  INIr.  Mc- 
Kinley ;  but  vve  have  quoted  enough  to  ilhistrate  the  mental  confu- 
sion of  the  great  latter-day  apostle  of  protection.  *  ®  *  •■■ 
Throughout,  we  encounter  that  playing  fast  and  loose  with  the  con- 
ception of  the  tariff  which  makes  it  impossible  to  reason  with  men 
like  the  present  Governor  of  Ohio,  and  which  would  inspire  distrust 
of  their  honesty  if  atrophy  of  the  logical  faculty  were  not  so  plainly 
evinced. —  The  Nation,  February  8,  1894. 


"  Last  year  we  paid  $55,000,000  out  of  oi. 
own  pockets  to  protect  whom?  To  protec 
the  men  in  the  United  States  who  are  pro 
ducing  just  one-eighth  of  the  amount  of  ou 
consumption  of  sugar.  Now  we  wipe  tha 
out,  and  it  will  cost  us  to  pay  the  bountj 
just  $7,000,000  every  twelve  months,  whicl 
furnishes  the  same  protection  at  very  mucl 
less  cost  to  the  consumer.  So  we  save  $48, 
000,000  every  year  and  leave  that  vast  sun 
in  the  pockets  of  our  own  people.  [Applaus 
on  the  Republican  side]"  (p.  452;  May  20 
1890). 


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